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Patricia O'Connell
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Laura Foggan Weighs In On Proposed Restatement of Liability Insurance Law

October 29, 2015

Laura A. Foggan, chair of Wiley Rein’s Insurance Appellate Group, was quoted extensively in an article published October 26 in Law360 about a proposal before the American Law Institute (ALI) that would create a Restatement for liability insurance law.

According to the article, the proposed Restatement —which would provide courts with a recommendation for uniform common law on insurance issues—has drawn criticism for not reflecting the norms of existing state insurance law.  Ms. Foggan said, “The biggest challenge insurers have had in looking at the project is that, in a number of places, the draft of the Restatement diverts from the prevailing common law rule and proposes something different.”  ALI Advisors and members will meet to discuss the “Restatement of the Law of Liability Insurance” project later this week.

Critics have singled out Section 19 of the Restatement which would prohibit insurers that had been found to have breached their duty to defend from contesting coverage for claims, at least where a court finds the insurer lacked a reasonable basis for denying a defense. Ms. Foggan is representing the interests of the American Insurance Association on this matter.  “Existing law has a way of dealing with insurer breaches, as it does policyholder breaches, and coming up with a new and punitive approach isn't appropriate in general or as a Restatement,” she said.

To read the entire article, click here.