Procedural Posture

Procedural Posture

Appellant insured filed a bad faith action against respondent insurer. The jury in the Superior Court of Los Angeles County (California) entered judgment in favor of the insurer. The insured appealed.

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Overview

At the time of an earthquake in 1994, the insured did not have earthquake coverage. The insured’s home was inspected and it was determined that she did not have earthquake damage. The insured then obtained coverage from the insurer that included earthquake coverage. Aftershocks that occurred after the insured obtained earthquake coverage damaged the insured’s home. The insured received a check for some damage caused by the aftershocks, but the rest of her claims were denied as of July 1995 as the insurer determined the damage had been caused by the original earthquake. The insured continued to submit estimates of her damage and the insurer continued to advise her that the claim was denied and the file was closed. The insurer also advised the insured of the policy’s “suits against us” provision. The insured file suit in 1997. The appellate court held that none of the subsequent letters that the insured received from the insurer tolled the running of the suit limitation provision as they all reaffirmed the denial of the claim. Cal. Civ. Code Proc. § 340.9 did not apply to revive the insured’s claims as the statute was limited to damages from the original earthquake.

Outcome

The judgment was affirmed.