CorVel Corp. Awarded $13.5M Due to Insurer Balking on E&O Obligations

A New York insurer that attempted to wriggle out of liability for class-action lawsuit damages sustained by a risk-management company in California must pay $13.5 million in damages and bad-faith penalties, a Delaware superior court judge decided. CorVel Corp. purchased a managed care organization errors and omissions liability policy from Homeland Insurance Co. that was in effect between 2005 and 2007. In 2006, a Louisiana hospital initiated a class-action arbitration proceeding against CorVel, accusing it of violating the state's Any Willing Provider Act (AWPA). The act requires ...