SAN FRANCISCO — A California appeals court has made it harder for insurance firms to defend bad-faith claims. The court’s ruling also sticks Mercury Casualty Co. with an expensive pill to swallow in a case stemming from a 2010 collision that left two pedestrians injured.
Mercury, which initially offered to settle claims against the driver for the policy cap of $30,000, was instead forced to pay more than $4 million after the Second District Court of Appeal in Los Angeles concluded in a decision published Monday that the insurer had unreasonably neglected to follow through on its early settlement offer.
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