996 N.E.2d 803
Ind. Ct. App.2013Background
- C & J Real Estate owned a commercial building and filed an insurance claim with Auto-Owners after an April 2010 hailstorm; Auto-Owners investigated and denied the claim.
- C & J sued Auto-Owners for breach of contract, bad faith, and breach of the duty of good faith and fair dealing.
- In discovery, C & J sought (Interrogatory 13) information about other Indiana commercial-property hail claims handled by Auto-Owners and (Request 8) reserve amounts set for C & J’s claim (and aggregate reserves).
- Auto-Owners objected on grounds of relevance, confidentiality, work-product/privilege, undue burden, and that reserve information was privileged.
- The trial court ordered production of the requested third-party claim information and reserve information; Auto-Owners obtained certification for interlocutory appeal and appealed to the Court of Appeals.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Discoverability of other insureds’ hail-claim information (Interrogatory 13) | Relevant to C & J’s bad faith and breach of good faith claims; could show patterns or practices | Irrelevant to contract coverage; confidential, proprietary, privileged, unduly burdensome | Court ordered production: third-party claim data is discoverable as relevant to bad faith/good-faith claims |
| Discoverability of reserve amounts for C & J’s claim (Request 8) | Reserves for C & J’s file are relevant and discoverable; insured requests its own policy information | Reserve info prepared in anticipation of litigation or privileged; protected by work-product rule and T.R.26 objections | Court ordered production: reserve amounts for C & J’s claim discoverable; no abuse of discretion in compelling production |
Key Cases Cited
- Ramirez v. Am. Family Mut. Ins. Co., 652 N.E.2d 511 (Ind. Ct. App. 1995) (third-party claim information not relevant to breach-of-contract coverage between insured and insurer)
- Allstate Ins. Co. v. Scroghan, 851 N.E.2d 317 (Ind. Ct. App. 2006) (documents relating to bad-faith claims against insurer are relevant and discoverable in bad-faith litigation)
- Schierenberg v. Howell-Baldwin, 571 N.E.2d 335 (Ind. Ct. App. 1991) (insurance reserve information held not discoverable in negligence context)
- Richey v. Chappell, 594 N.E.2d 443 (Ind. 1992) (discusses limits on discovery of insurer materials and statements in third-party litigation)