This is the first in a series of discussions about insurance issues unique to the Lone Star State.
For nearly a century, the Stowers doctrine has been a critical cornerstone of Texas insurance law protecting insureds facing the threat of a nuclear verdict. This doctrine, named after the seminal 1929 case G.A. Stowers Furniture Co.
As the Fifth Circuit reminded us in a December 21 de
cision, primary insurers can find themselves in excess insurers’ shoes if they reject settlement demands within their policy limits. In American Guaranty & Liability Insurance Co. v. ACE American Insurance Co., the Fifth Circuit upheld a lower court ruling requiring a primary insurer
Every policyholder will likely face a scenario where its primary insurer refuses a settlement offer within limits. The primary insurer is potentially liable for that excess verdict if it acted in bad faith by refusing to settle within limits. Sometimes, a primary insurer will roll the dice because the policyholder procured excess liability coverage that