This year the Connecticut Supreme Court issued a ruling with broad implications for insurance coverage disputes. In Capstone Building Corp. & Capstone Development Corp. v. American Motorists Insurance Co., 308 Conn. 760 (2013), a unanimous Supreme Court decided two highly significant issues in the insurance coverage arena which will impact a broad scope of coverage disputes under commercial general liability (CGL) policies.
First, the court put to rest the argument that policyholders could maintain a bad faith claim even if the insurance policy did not cover the underlying claim in the first place, rejecting lower court decisions that appear to create an independent tort of bad faith in the insurance context.
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