Acquista v New York Life Insurance Company - New York Supreme Court Appellate Division (Tom JP, Mazzarelli, Andrias, Wallach and Saxe JJ) - 16 July 2001

Insurance law - New York Appellate Court holds that insurance companies who unreasonably refuse to pay claims may be liable to pay consequential damages for distress and inconvenience

The New York Supreme Court, Appellate Division, has produced an important decision which may well have ramifications in the marine insurance law field, bearing in mind that many marine insurance policies in the United States are subject to New York law. At issue was whether the insured was entitled to collect consequential damages for mental distress, aggravation and inconvenience by reason of the insurer’s denial of the claim with knowledge of the lack of a reasonable basis for the denial.