Insurance Coverage Litigation Lawyer & Attorney : Rivkin Radler Law Firm : Long Island, New York

On January 25, 2008, a Southern District of Ohio magistrate found that a reservation of rights letter established an expectation of litigation that supported a work product claim. St. Paul Fire and Marine Insurance Co. v. ConAgra Foods, Inc., 2008 U.S. Dist. LEXIS 8945 (S.D. Ohio Jan. 25, 2008). This decision will be welcomed by Insurers seeking work product protection. But, insurers should also expect that this shield will be the policyholders' sword. Policyholders will surely be arguing that reservation of rights letters trigger an expectation of litigation that requires a litigation hold. The developments in this area will be interesting to watch.

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Much of a coverage lawyer's work involves reviewing and writing letters to policyholders. To you, the real coverage lawyers of America, read Lutz v. First Financial Insurance Co., 2007 U.S. App. LEXIS 21872, a Ninth Circuit decision reviewing the adequacy of a denial letter. The majority found that the insurer's denial letter was not adequate because it did not reference to specific law or facts relating to the dispute, and the policy provisions that were cited were not tied to the defense to coverage. A dissenting judge criticized the letter as "somewhat confusing and perhaps in part misleading," but he held that a letter is adequate if it provides timely notification of an intent to deny and a defense. Coverage lawyers should be mindful of these standards in preparing communications to policyholders.

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