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Violation of Statute Allows Suit for Negligent Failure to Resolve \\nInsurance Claim\\n\\nPost 4706\\n\\nChristine Moody, individually, and in her capacity as the Personal \\nRepresentative of the Estate of Steven "Troy" Moody, Deceased v. Oregon \\nCommunity Credit Union, aka OCCU, an Oregon entity, association, union, \\nor corporation et al., Defendants, and Federal Insurance Company, an \\nIndiana corporation, 371 Or. 772, SC S069409, Supreme Court of Oregon \\n(December 29, 2023)\\n\\nPlaintiff, whose husband was accidentally shot and killed during a \\ncamping trip, brought this action against defendant, a first-party life \\ninsurer, claiming, among other things, that defendant had negligently \\nfailed to investigate and pay her claim for policy benefits, causing her\\n to have fewer financial resources to navigate the loss of a \\nbread-winning spouse and, consequently, to suffer economic harm and \\nemotional distress.\\n\\nFACTS\\n\\nIn the case now before the Supreme Court it must consider whether \\nplaintiff has alleged a legally protected interest sufficient to subject\\n defendant to liability for emotional distress damages. To decide \\nwhether that alleged interest is a legally protected interest sufficient\\n to subject defendant to liability for emotional distress damages.\\nPlaintiff has alleged a viable common-law negligence claim against \\ndefendant for emotional distress damages. Therefore, the trial court \\nerred in granting defendant\'s motions to dismiss plaintiffs negligence \\nclaim and in striking her claim for emotional distress damages.\\n\\nZALMA OPINION\\n\\nThe state of Oregon, like many states, has enacted statutes punishing \\ninsurers for bad faith claims handling. The insurer, after a change in \\nallegations, paid the plaintiff the $3,000 life insurance limit, only to\\n find itself sued for negligent claims handling. The suit was dismissed \\nby the trial court and reversed by the Court of Appeals and the Oregon \\nSupreme Court. Since the statute requires fair claims handling the \\nplaintiffs allegations allowed it to sue the insurer for emotional \\ndistress damages when it initially refused to pay because of an \\nexclusion.\\xa0 This is a limited decision and stretches the obligations of \\nan insurer beyond fairness and even with a clear and unambiguous \\nexclusion it can be sued for emotional distress.\\n\\n(c) 2024 Barry Zalma & ClaimSchool, Inc.\\n\\nPlease tell your friends and colleagues about this blog and the videos \\nand let them subscribe to the blog and the videos.\\n\\n\\nInsurance Claims Library \\u2013 \\nhttp://zalma.com/blog/insurance-claims-library.