The Sounds of Silence: Waiting for Courts to Acknowledge that Public Policy Justifies Awarding Damages to Third-Party Claimants when Liability Insurers Deal with them in Bad Faith

Abstract

Law. I owe many thanks to Dean Peter Glenn for his enthusiastic support of this and other research projects, which were made possible by the award of a summer research stipend. I would also like to thank Andrew Tillapaugh, Class of 2002, for his dedicated research assistance and helpful conversations as I developed this topic, and to Carrie Leslie, Class of 2002, for research assistance in the final stage of the project. I received many helpful comments from colleagues when I presented this paper at a faculty colloquium, and I especially wanted to thank my colleague, Mike Navin, for his spirited critique of my thesis. Tom Baker provided some incisive comments, suggestions, and criticisms in an effort to strengthen my thesis, for which I am grateful. Hoyd Wilson of McCary, Wilson, & Pryor, P.C. in Albuquerque, New Mexico provided extensive comments "from the trenches" that I found very helpful. Most important, I am grateful to Jeff Stempel for his very helpful comments on a draft and for his kind invitation to join in this project and to have the honor of submitting these thoughts alongside the essays of a distinguished group of insurance law scholars and practitioners.

The Ownership Complaint Gap: Mutual versus Stock Intermediaries

“…We concentrate on insurance firms, an important and prevalent financial intermediary that accounts for 41.7% of financial institution activity in 2016 (https://www.naic.org/state report cards/report card wa.pdf). Legal scholars describe numerous anecdotal accounts of service quality issues in the insurance industry (Mootz (2002)). Accenture and JD Power report that approximately one-fourth of insurance claimants are dissatisfied, suggesting that this financial intermediary sector provides a good laboratory to investigate customer treatment.…”