Goldberg Segalla partners Christian A. Cavallo, Kevin P. Sullivan, and Thomas M. Wester, in the firm’s Global Insurance Services practice group, took a deep dive into insurance coverages in New Jersey with Law360.
In the article, they explore the nuances of the duty to defend, reservation of rights, and bad faith liability.
While analyzing the duty to defend in New Jersey, they wrote that “whereas most states require an insurer to defend all claims, even if only one claim is covered, New Jersey law allows an insurer to allocate its defense obligation between covered and uncovered claims, such that it owes a defense only for covered claims.”
For cases involving the reservation of rights in New Jersey “other states may deem an insured’s right to reject an offered defense obvious, and therefore, not require this option to be expressly stated, in New Jersey it is central to the validity of a reservation-of-rights letter.”
The article continues to discuss the unique considerations for bad faith liability in New Jersey with an analysis of U.S. District Court for the District of New Jersey case, Kelley v. Massachusetts Bay Insurance Co.
“As the foregoing demonstrates, there are a multitude of state-specific requirements and nuances that make New Jersey insurance law unique. It is imperative therefore, for prudent carriers to stay up to date on the most recent developments in case and statutory law,” they concluded.
READ THE FULL ARTICLE:
“3 Quirks Of New Jersey Insurance Coverage Law,” Law360, October 24, 2023 [Subscription Required]
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