Morrison Mahoney partner Bill Schneider was recently quoted in Massachusetts Lawyers Weekly regarding a fire case where the insurance carrier violated Chapter 176D.
A Federal judge presiding over a c. 93A against an insurer found that it committed an unfair and deceptive act when it failed to show that its post-judgment offers to settle – for an amount less than half the verdict – was reasonable. The issue in dispute concerned the insurer’s judgment both before and after the verdict. The court found that the insurance company’s offer prior to trial was in fact reasonable and supported by the impression of reputable defense counsel. However, once the jury found for the plaintiff, the judge concluded liability was reasonably clear. In reaching his decision, the court rejected the insurer’s argument that coverage did not apply to claims in question.
“If you look at this case and think about other big 93A bad-faith cases where insurers got walloped for a lot of money, the real problem with their conduct occurred after the verdict, when they were assessing the case,” Schneider said. “And Judge Young, frankly, gives a roadmap in the decision [indicating] that a reasonable defense maneuver would be to make a substantial offer that discounts the jury verdict by likelihood of success on appeal.”
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