A gas station owner sued its insurer for bad faith and sought in excess of $2 million in damages from the insurer. The underlying claim involved a truck striking one of the station’s pumps and allegedly damaging the underground piping. After the case was litigated for a year, claimant amended its complaint to add the insured and we were assigned to defend the insurance agent.
The agent sold a general liability policy to claimant. The insurer denied the gas station claim, in part, due to late reporting, which claimant alleged was due to the agent’s negligence. After one round of limited written discovery and a single deposition, we settled the case for $15,000, persuading the plaintiff’s counsel that although there was an issue of fact as to who caused the late reporting, the insurer’s other bases of denial would have precluded the plaintiff from recovery in any event. As such, the insured’s alleged negligence was not the cause of plaintiff’s loss of recovery.