The insurer denied a property damage claim arising out of a leak in a home heating oil tank making the home uninhabitable. The insured brought suit for breach of contract and bad faith. The carrier moved to dismiss the bad faith claim on the basis it only set out bare bones allegations, and failed under the Twombly/Iqbal pleading standards. The court agreed, but gave the insured leave to amend her complaint.
The court observes that the insured’s complaint fails to “allege facts regarding the terms of her insurance policy, when she submitted a claim to [the insurer], the investigation that [the insurer] performed, or any communications between herself and [the insurer].” Despite the absence of any factual allegations, the insured still claims the inspection was substandard and hasty, the insurer refused to provide additional living expenses contrary to the policy, and her claim was “improperly denied.”
The litany of bare bones conclusory allegations failing to make out a claim includes assertions that the insurer “(1) sent a false denial letter; (2) failed to adequately investigate the loss before claiming it was not covered by the policy; (3) failed to pay a fair and reasonable amount for the claim; (4) asserted policy provisions without a reasonable basis; and (5) misrepresented facts and policy provisions.” These “threadbare recitals” did not allege, e.g., “how [the insurer] failed to investigate and evaluate the claim in a fair manner.”
The court refused to infer bad faith absent facts regarding the insured’s claim itself, and the insurer’s “accompanying investigation, negotiations, or communications in support of the contention that [its] conduct was unreasonable and reckless….” A plaintiff must “describe who, what, where, when, and how the alleged bad faith conduct occurred.”
The insured was given 14 days to amend her complaint.
Date of Decision: December 4, 2019
Biela v. Westfield Insurance Co., U. S. District Court Eastern District of Pennsylvania CIVIL ACTION v. NO. 19-04383, 2019 U.S. Dist. LEXIS 209418 (E.D. Pa. Dec. 4, 2019) (Pappert, J.)