Rex Heinke & Warren J. Biro

Abstract

This article discusses whether commercial liability insurers have a duty to provide coverage to policyholders who are sued because their activities contribute to global warming. It focuses on a decision by the Virginia Supreme Court in AES Corp. v. Steadfast Insurance Co., in which the plaintiff insurer argued that emitting carbon dioxide into the atmosphere was not an “occurrence” as defined in the insurance policy and therefore did not trigger coverage. The Virginia Supreme Court agreed, holding that the insurer was not required to provide coverage for any period in which the policyholder knew, or should have known, that the emission of carbon dioxide had a substantial probability of causing harm.

John H. Fitzpatrick

Michael B. Gerrard & Joseph A. MacDougald

Abstract

This article discusses the advancement of climate change litigation and explores two approaches: using the federal regulatory apparatus and using the tort system. It examines key questions in climate change litigation, including who is responsible for determining the appropriate level of harmful emissions, how courts should handle the long-tail effects of climate change, what the proper forums for litigation are, and what role the federal government should play in addressing climate-related harms.

Christian Armbruester

Abstract

This article discusses the newly drafted “Principles of European Insurance Contract Law” (PEICL). It explores the possibility of the PEICL becoming an optional legal instrument that parties to an insurance contract may use as an alternative to relying on the laws of the various Member States in the European Union. The article provides an in-depth investigation of the PEICL and concludes that while the draft language could benefit from certain adjustments, it nonetheless offers a strong basis for discussion among policymakers in both the European Union and the United States.

James M. Fischer

Abstract

This article explores the uncertainty surrounding an insured’s duty to mitigate losses after an insurer has breached its contract. It examines the arguments for and against imposing a mitigation requirement and concludes that insureds seeking damages for an insurer’s breach of a contractual obligation should be required to mitigate their losses regardless of the type of insurance policy at issue. The article argues that an insured’s failure to act reasonably post-breach should result in the insured bearing responsibility for losses that could have been avoided.

Johnny Parker

Abstract

This article explores the inconsistency with which courts interpret severability of interest clauses in insurance policy exclusions. It examines severability of interest clauses and discusses the rules courts use to interpret them. Specifically, the article outlines three methodologies of contract interpretation that courts employ when faced with severability-of-interest clause controversies and evaluates each method’s strengths and weaknesses. The article concludes that behind these different interpretive methods lie two schools of thought among the courts: those that follow a “traditional or formalist” approach and those that follow a “functional or reasonable expectations” approach.

Tom Baker & Peter Siegelman

Abstract

Persistently high profits on “insurance” for small-value losses sold as an add-on to other products or services (such as extended warranties sold with consumer electronics, loss damage waivers sold with car rentals, and credit life insurance sold with loans) pose a twofold challenge to the standard economic analysis of insurance. First, expected utility theory teaches that people should not buy insurance for small-value losses. Second, the market should not, in the long run, permit sellers to charge prices that greatly exceed the cost of providing the insurance. Combining the insights of the Gabaix and Laibson shrouded pricing model with the behavioral economics of insurance, this article explains why high profits for add-on insurance persist and describes the negative distributional and welfare consequences of an unregulated market for such insurance. The article explores four potential regulatory responses: enhanced disclosure, a ban on point-of-sale offerings of add-on insurance, price regulation, and the creation of a new online market. Drawing on theoretical, empirical, and comparative law sources, the article explains why enhanced disclosure will not work, identifies the circumstances in which a point-of-sale ban is desirable, and argues that a new online market is preferable to price regulation when a point-of-sale ban is undesirable.

Melanie A. Orphanos

Abstract

This article addresses the insurance implications of the pending concussion litigation between the National Hockey League and its current and former players. The author draws comparisons to similar litigation brought against the National Football League and the NFL’s interactions with its insurers to forecast the obstacles the parties in the NHL litigation will face in establishing coverage by the many insurance carriers that have insured the NHL over time. The author identifies obstacles including determining when coverage is “triggered” and whether certain actions by the NHL will preclude coverage and relieve the insurers of their duty to defend under the policies’ “expected or intended” clauses.

Danielle M. Jaffee

Abstract

This Note examines the recent trend toward class actions challenging insurers’ denial of autism treatment coverage. The author analyzes how state and federal laws regarding insurance coverage for autism treatment create a gap that allows insurers to deny coverage, even despite overwhelming evidence of the benefits of such treatment for autistic individuals. Past individual challenges of insurers’ actions have provided little guidance to consumers about insurers’ legal obligations, and recent collective actions have done little to clarify these obligations. The author reviews the decisions of three courts addressing the certification of class challenges to insurers’ denials and offers suggestions for how consumers can successfully challenge insurers’ practices in future class actions.

Edward A. Zelinsky

Abstract

Half of American workers are not covered by employer-sponsored retirement arrangements. The recently passed California Secure Choice Retirement Savings Trust Act seeks to solve this problem by mandating retirement savings arrangements for California employers, coupled with a public investment vehicle for investing these private retirement savings. The Act is particularly significant because of California’s size and its status as a trendsetter for other states. This Article is the first to examine the important legal questions the Act raises under the Internal Revenue Code and ERISA. Contrary to the drafters’ intent, the savings accounts authorized under the Act do not qualify as individual retirement accounts under the Code; as a result, employees participating in savings arrangements established under the Act will not receive the income tax benefits associated with individual retirement accounts. If the Act were amended to make its accounts individual retirement accounts, it would survive ERISA preemption under New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Insurance Co., 514 U.S. 645 (1995), though not under Shaw v. Delta Air Lines, Inc., 463 U.S. 85 (1983). Because Travelers is the Court’s more recent and more compelling construction of ERISA preemption, the Act should survive ERISA preemption if amended to create true individual retirement accounts.