Dire predictions that the Affordable Care Act would lead to job losses and cuts in employee hours have so far proved to be unfounded, according to a new research paper from Federal Reserve Bank of New York economist Maxim Pinkovskiy and reported on the website of CBS Moneywatch.

According to the CBS report, “The fear was that employers who were newly required to provide health insurance to their workers would opt instead to cut hours or fire employees. But early numbers show that locations with a high percentage of uninsured Americans, such as Texas, ended up experiencing a rise in employment, salaries and output in comparison to areas with less exposure to the health care law, Pinkovskiy noted.”

Part-time work in states where Obamacare had major impact saw “a statistically insignificant decline in their part-time to full-time ratio,” Pinkovskiy wrote.

Read the report.

Contracts with tech vendors increasingly include requirements of cyber-risk insurance coverage, but where the value and risks associated with the data to be shared with or created by the vendor warrant such a requirement, you should probably take a look at the coverage – and not just a certificate of coverage – to see what you’re getting, writes Jon Neiditz in Kilpatrick Townsend’s Big Data Tech Law blog.

First of all, he advises, always make sure you know what if any critical digital assets other than personally-identifiable information (PII) are covered.

He categorizes the questions as general, amount and scope of coverage, insurance claims process and dispute resolution, and provisions regarding the defense of an underlying claim or lawsuit.

Read the article.

Saxe Doernberger & Vita has released a comprehensive survey that examines several key issues relating to the scope and extent of workers’ compensation requirements and immunity across all 50 states.

This comprehensive survey examines several key issues relating to the scope and extent of workers’ compensation requirements and immunity across all 50 states. It discusses, among other topics, exclusive remedy protections and the application of such protections in the Consolidated Insurance Program (a.k.a “wrap up”) context.

For each state the survey reviews:
• Type of Workers’ Compensation Insurance (private or state funded)
• Workers’ Compensation Exclusive Remedy Statute
• Principal/Statutory Employer Doctrine
• Application of Exclusive Remedy Statute to Principal/Statutory Employers
• Application of Exclusive Remedy Statute to Wrap-Ups
• Subrogation Waiver Prohibition by Statute

Why This Survey is Important
A fundamental principle of workers’ compensation laws is that an employer who provides compensation to an injured employee (pursuant to the applicable state statute) is entitled to immunity from civil actions by that employee or his/her representatives (i.e., an employee’s exclusive remedy is workers’ compensation benefits). Under certain circumstances and in some jurisdictions, this immunity is extended to upstream parties such as a project owner or general contractor. This survey should help construction professionals begin to navigate the complex world of worker’s compensation immunity law.

Download a complimentary copy of the survey.

Saxe Doernberger & Vita P.C.
From the firm’s release: “Saxe Doernberger & Vita, P.C., is a national insurance coverage law firm focused exclusively on representing corporate policyholders. Our experienced trial lawyers are admitted in courts across the country and represent clients in multiple industries including construction, power and energy, real estate, and more. At its core, SDV’s practice is about the prevention and resolution of insurance disputes.”

An article posted on the website of Neal, Gerber & Eisenberg discusses the adoption of the estoppel principle as a remedy for policyholders who have been wrongfully denied a defense by their liability insurers, as covered in the American Law Institute’s Preliminary Draft No. 1 of the Restatement on Liability Insurance.

“The rule that the duty to defend is triggered by unproven allegations, referred to as the ‘potentiality standard,’ recognizes the reality that the insured has no control over how the allegations are plead in liability matters,” writes Jill Berkeley.

“Estoppel, or forfeiture of defenses against coverage, in the end, is the penalty for a wrongful breach of the duty to defend. If there were no estoppel or additional risk to the insurer, there would be no downside to the insurer for wrongfully denying the policyholder the benefit of its bargain,” she writes.

Read the article.

The 5th U.S. Circuit Court of Appeals has further addressed the area of contract and insurance interplay with its decision in Ironshore Specialty Insurance Co. v. Aspen Underwriting Ltd. et al., No. 13-51027, (5th Cir. June 10, 2015), reports Liskow & Lewis in an article posted on Lexology.com.

“The appellate court was asked to determine whether, under Texas law, contractual requirements in a master service agreement obligating the contractor to name the oil company as an additional insured and provide $5 million in additional insured coverage served to limit the amount of insurance provided to $5 million notwithstanding that the liability limit of the contractor’s insurance program was significantly greater ($50 million),” the article says.

The Court ultimately concluded that the “Insured Contract” provision discussed in Deepwater Horizon was sufficient to incorporate the limitations of the MSA.

Read the article.

Some of the most boilerplate-looking provisions in contracts are often the most onerous, writes Josh M. Leavitt of Much Shelist, P.C.

He gives an example of how indemnity clauses qualify: an indemnifying party (such as a contractor) could find itself owing the indemnified party (such as an owner and its architect) substantial reimbursements and defense costs (including even provision of an attorney) for the defense of third-party claims (such as the claim of a supplier). “This could happen where the indemnifying party (the contractor) was only alleged to have been partially at fault — and even where the contractor may not have been at fault at all.”

He writes that it is important for indemnitors (those giving indemnity rights) and indemnitees (those receiving indemnity rights) to understand the risks involved with these clauses.

Read the white paper.

The Illinois Appellate Court tackled one of the most misunderstood issues in the commercial general liability policy: Does an obligation to indemnify trigger insurance coverage? The National Law Review reported on the ruling, writing that, although the facts in Bituminous Casualty Corporation v. Plano Molding Company are not typical for most general liability disputes, the analysis and reasoning of the court are helpful in understanding this pesky part of the policy.

“At issue was a clause in a bill of lading issued by Plano, a manufacturer of storage boxes, in which it agreed to indemnify K-Line, a railroad carrier who was shipping the merchandise, ‘for any injury, loss or damage caused by breach of warranty’ that the cargo being shipped was ‘safe and proper and suitable for handling and carriage,” the report explains.

The court found that “because defendant (the Insured) is liable only for its own breach of warranty, it has not assumed liability for K-Line’s negligence.”

Read the report.

When allocating risk inherent in a construction project, it is necessary to pay close attention to the interplay between indemnity and insurance to ensure the objectives of the parties are achieved, writes Jeffrey A. Kiburtz of Pillsbury Winthrop Shaw Pittman in a paper published in Lexology.

He writes that each has its advantages and limitations, but can effectively be combined to secure the performance of the myriad participants in construction projects of all complexities.

The paper covers the varying scopes of protection, the timing of performance, and the likelihood of performance.

Read the article.

A posting by by Mike Reilly on the Lane Powell website considers the question: When does the court apply “equitable tolling” to extend the time by which a claimant may file suit beyond the contractual limitations provision?

The article discusses the case of Wilson v. Standard Insurance Company, 2015 WL 3477864 (11th Cir. June 3, 2015)(Equitable tolling rejected even though claim denial letter failed to state date by which civil claim must be brought.)

The 11th U.S. Circuit Court of Appeals found that equitable tolling does not trump the contractual limitations provision.

Read the article.

The 6th U.S. Circuit Court of Appeals recently predicted that the Kentucky Supreme Court would not allow insurers to sue policyholders for the tort of “reverse bad faith,” reports Carlton Fields Jorden Burt in a report posted on JDSupra.

“The court’s analysis drew a distinction between the duty of good faith and fair dealing that is implied by law into contracts and the distinct, common law duty that arises from a ‘special relationship’ between the parties,” the report says. “Only the latter duty gives rise to a tort claim.  The court also found that no other state has recognized a tort of reverse bad faith.  Yet, given recent interpretations of the contractual duty, it’s arguable that ‘reverse bad faith’ is already here — and what we should be asking is whether it can be of any use.”

The case was State Auto Property & Casualty Ins. Co. v. Hargis. It involved an insurance case that included allegations of arson.

Read the article.

The parent company of New Jersey’s largest utility has reached settlements worth more than $200 million with insurance providers over claims from Hurricane Sandy, according to a quarterly filing, ending a legal dispute stemming from the October 2012 storm, reports NJ.com.

PSEG filed a lawsuit in the summer of 2013 claiming that its insurers wrongly denied the company full coverage for its losses during the storm, NJ.com reports. A state Superior Court judge in Essex County sided with PSEG in that case in March, finding that the company’s damages from storm surge were not subject to a limit for flooding.

Read the story.

Cyber insurance programs are necessary for small, mid-size, and large businesses to help them manage the risks from data breaches.  Simply put, cyber insurance can provide a business with protection in the event of a cyber attack, writes Jonathan Reich, a Womble Carlyle attorney in the firm’s Winston-Salem office.

“Business leaders and corporate boards can no longer ignore the very real possibility of unauthorized access and dissemination of confidential customer information,” he writes. “This could be financial data, it could be sensitive health information, or it could be confidential trade or industry secrets.  Through no fault of a company, it can become a victim of malicious software or a coordinated attack by international hackers who seek to sell the information gained or hold the information for ransom.”

He explains that, although many cyber insurance companies in the market provide a variety of coverages, not every cyber policy provides all these types of coverages.

Read the article.

Susan G. Schellinger

The Wisconsin Supreme Court recently issued a decision that drives home the importance for businesses and individuals, as policyholders, to immediately report claims to their insurance company, writes Susan G. Schellinger, a shareholder in the Milwaukee office of Davis & Kuelthau.

“Even a small delay may result in a loss of coverage thereby increasing the risk that, if a claim against you is successful, you will be left to pay for the legal fees to defend the claim, along with the damages that you may be ultimately responsible for – even if your insurance policy would have paid those costs in full if you had notified the insurance company promptly,” she writes.

In the recent case of Anderson v. Aul, issued Feb. 25, 2015, the Wisconsin Supreme Court found that under a claims-made-and-reported liability policy, the policyholder’s failure to report the claim during the term of the policy resulted in a loss of coverage.

Read the story.

The Centers for Medicare & Medicaid Services has issued a final rule implementing provisions of the Strengthening Medicare and Repaying Taxpayers Act (the SMART Act), establishing a right of appeal and formal Medicare Secondary Payer (MSP) appeals process for applicable plans, reports Carr Allison Medicare Compliance Group.

On its website, the firm says the appeals process is for situations when Medicare seeks to recover payments from applicable plans, including liability insurance (including self-insurance), no-fault insurance, and workers’ compensation laws or plans.

The firm offers some notes regarding the final rule.

Read the story.

When a party seeks penalties as a result of an insurer’s failure to pay a settlement within 30 days, the party need not prove the insurer was “arbitrary, capricious, or without probable cause” in failing to pay, according to a recent decision in the Louisiana Third Circuit Court of Appeal. That’s the analysis offered by Mark Perkins of Perkins & Associates, L.L.C., a regional defense firm serving North Louisiana and Northeast Texas.

Perkins said that’s it’s important to note that this is a Third Circuit case and may not apply to other venues in Louisiana.

However, he said, anyone confronted by a plaintiff’s attorney in Louisiana threatening penalties and attorney’s fees for failing to fund an alleged agreement within 30 days, should review:

“When a party seeks penalties as a result of an insurer’s failure to pay a settlement within 30 days, the party need not prove the insurer was ‘arbitrary, capricious, or without probable cause’ in failing to pay; rather, the party need only show that the insurer’s failure was ‘knowingly committed.’ While the compromise must be made in writing and evidenced by documentation signed by both parties, there is no requirement that the compromise be contained in a single document. However, a letter written by one party memorializing their understanding of an oral agreement was insufficient to satisfy the ‘in writing’ requirement of La. C.C. art. 3072, and thus there was no agreement of the parties triggering the penalties for non-payment set forth in La. R.S. 33:1973. Barnes v West, Third Circuit, No. CA 14-1018 (2/4/15), at www.la3circuit.org/Opinions/2015/02/020415/14-1018opi.pdf.”

The court described the case:

Marsh USA offers a free on-demand webinar in which a panel of risk experts provide real-world examples of deal issues and how the insurance market can be accessed to solve them.

The topics include representations and warranties, tax and indemnity insurance, contingent liability insurance, political risk insurance for private equity investments in emerging markets, non-payment coverage for commercial contracts or debt transactions, kKey life and disability policies, environmental insurance, and environmental liability buyouts.

Watch the on-demand webinar.

Benefit Express will present a free webinar reviewing the topic of Medicare and how it can affect Employers Health Coverage offerings.

The webinar will be Tuesday, April 7, at 1 p.m. Central time.

The topics will include employer secondary rules, COBRA, notice requirements and reporting requirement.

Benefit Express Services, LLC was established in 2001. It’s a benefits administration solutions firm that provides HR professionals with the tools and services necessary to simplify the benefits administration process.

Register for the webinar.

Insurance certificates are a critical part contract management. To improve risk management, contracts often require a party to carry certain insurance policies. The risk management benefits of these provisions are lost unless you track the insurance certificates in addition to the contract.

A new article and video from Berkman Solutions outline steps for managing insurance certificates required in a contract.

“You have carefully allocated risk in contract drafting,: the article says. “It is clear that the other party is responsible for their conduct and any damages your organization suffers. You go the extra step to require that the other party carry relevant liability insurance. In some cases, they must also name you as an additional insured party on their policy.

“The contract is executed. Now what? You add the contract and its expiration date in the contract management spreadsheet. You even collect the insurance certificate at signing.

“What is the problem? The problem is that the insurance certificate expires before the expiration of the contract. It is quite rare that the insurance certificate and the contract share the same time line.”

Read the article and watch the video.

A white paper posted by Jones Day partner Tara Kowalski on the firm’s Insurance Policy Advocate site says a recent string of cases addressing suit limitation provisions serves as a reminder of the numerous traps that surround such provisions and how insurer conduct can be misleading in those situations.

The article points out that suit limitation provisions are the contractual equivalent of statutes of limitations.

“They require policyholders to file coverage lawsuits within a specified period of time or risk forfeiting coverage for the claim at issue. The most common time period is one or two years – which is often shorter than the otherwise applicable statute of limitations,” Kowalski writes. “Despite the potential for Draconian results, suit limitation provisions are generally enforceable, subject to certain limitations. And, some jurisdictions don’t require a showing of prejudice from the insurer. Suit limitation provisions are often found in first-party policies and only rarely in liability policies.”She offers a summary of some recent cases addressing suit limitation provisions, as well as some practice pointers based on the rulings in those cases.

Read the white paper.

In a case that has been closely watched by the oil and gas industry and its insurers, the Supreme Court of Texas issued its opinion in In re Deepwater Horizon on Feb. 13, 2015, and settled the debate concerning whether a company’s insurance policies stood alone or were married to and dependent upon an insured’s limited obligation in a separate contract to insure and indemnify a third party, according to a white paper published by Baker Hostetler.

The article says the court found that Transocean’s $750 million primary and excess insurance policies did not offer unrestricted coverage to BP as an additional insured, but instead incorporated and were bound by the limitations placed on Transocean’s liability under the parties’ drilling contract.

The major takeaways, acording to the firm’s report: know your partner, know your risks, and know your insurer.

Read the white paper.