Commercial Division Blog
Insurer Owed Pre-Judgment Interest From Date of Wrongful Disclaimer of Coverage
On August 7, 2017, Justice Ramos of the New York County Commercial Division issued a decision in J.P. Morgan Securities Inc. v Vigilant Insurance Co., 2017 NY Slip Op. 31690(U), holding that an insurer owed pre-judgment interest from the date of its wrongful disclaimer of coverage, explaining:
Once the Insurers repudiated liability and Bear Stearns made, payment of its own covered losses, the law regards the Insurers as being in breach, and as a result, Bear Stearns possesses a liquidated claim. To this effect, the Court granted summary judgment in JP Morgan's favor, and denied the Insurers' cross-motion.
In the insurance context, pre-judgment interest runs from the date of a breach on the part of an insurer and a liquidated claim. Thus, JP Morgan is entitled to pre-judgment interest from April 4, 2006, which is the date that Bear Stearns demanded payment from the Insurers for the settlement of the SEC regulatory action.
(Internal citations omitted).