In insurance coverage litigation, does an insurance company have to identify and produce documents regarding the company’s handling of prior unrelated claims?
Insurance companies often object to such requests on the grounds that they are irrelevant, overly broad, unduly burdensome, and even protected by a privilege. In the Illinois Appellate Court Fifth District’s recent decision in Zagorski v. Allstate Ins. Co., 2016 IL App (5th) 140056, however, the appellate court rather emphatically held that the insured could seek such discovery, at least under the facts and circumstances of that particular fire loss claim. In so doing, the Fifth District expanded the scope of the discovery in insurance law cases by holding that, in some instances, an insurer’s conduct in unrelated claims can provide evidentiary support for a vexatious refusal to pay claim under 215 ILCS 5/155. It also put carriers on notice that any future challenges to such written discovery will need to be well supported by the record.
In their recently published article in the IDC Quarterly, HeplerBroom insurance law attorneys Michael L. Young and Katie E. Jacobi discuss the Fifth District’s holding in Zagorski, its limitations, and possible approaches by insurance carriers in response to it. The full article is available here.