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Bad Faith Blog

We cover current issues, highlights and best practices exclusively on claims of bad faith and extra contractual damages.

Bad Faith Blog
August 6, 2015

Tall Task to Prove Excess Insurer Breached its Duties to Insured

Summary: Kevin Fox won a $15.5 million jury verdict (including $6.2 million in punitive damages) against Will County detectives. After the verdict, the parties agreed to a settlement in which Fox was assigned any claims the detectives had against the county’s insurance companies. Fox filed this suit seeking a declaratory judgment that AAIC, the insurer, had breached its duty to defend the detectives in the earlier suit. The suit also included two breach of good faith duty claims: (1) failure to reasonably settle the claims within policy limits, and (2) failure to inform the detectives of conflicts of interest created by joint representation and Fox’s punitive damages claim. The Seventh Circuit affirmed the judgment of the district court and determined that no good faith duties were breached.