Blue Shield Loses Appeal Over Bad Faith Claims

Law360, New York (February 10, 2011, 3:09 PM EST) -- A California appeals court has rejected Blue Shield of California Life & Health Insurance Co.’s attempt to discard tortious bad faith claims from a suit alleging it improperly rescinded a policy, finding that policy language extended the statute of limitations.

On Wednesday, the California Second District Court of Appeal refused to reverse the lower court and grant Blue Shield summary judgment that plaintiff Myrna Kawakita is precluded from pursuing a tort cause of action over the insurer’s rescission of its policy.

Blue Shield rescinded the policy...
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