What is the Unfair Insurance Practices Act (UIPA)?

There is an Unfair Insurance Practices Act (UIPA) (Ins. Code § 790, et seq.). But there is no private civil cause of action against an insurer under UIPA. Moradi-Shalal v. Fireman's Fund Ins. Companies, 46 Cal.3d 287, 304 (1988).

However, “Moradi-Shalal does not bar the claim under the UCL.” (Zhang v. Superior Court (2010) 178 Cal.App.4th 1081, 1085.) “We have made it clear that while a plaintiff may not use the UCL to ‘plead around’ an absolute bar to relief, the UIPA does not immunize insurers from UCL liability for conduct that violates other laws in addition to the UIPA.” (Manufacturers Life Ins. Co. v. Superior Court (1995) 10 Cal.4th 257, 283-284; see also Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Co. (1999) 20 Cal.4th 163, 182-183; Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 43; Stop Youth Addiction, Inc. v. Lucky Stores, Inc. (1998) 17 Cal.4th 553, 565.)

“[T]he UCL, in Business and Professions Code section 17200, defines "unfair competition" to include "unlawful, unfair or fraudulent business" acts or practices, and "unfair, deceptive, untrue or misleading advertising." There can be no doubt that false advertising is a recognized basis for suit under the UCL both expressly as provided in the statutes and in case law. (Zhang v. Superior Court (2010)178 Cal.App.4th 1081, 1089 citing Shersher v. Superior Court (2007) 154 Cal.App.4th 1491, 1494-1496; Linear Technology Corp. v. Applied Materials, Inc. (2007) 152 Cal.App.4th 115, 132-133 (finding allegations insufficient); Colgan v. Leatherman Tool Group, Inc. (2006) 135 Cal.App.4th 663, 679; Belton v. Comcast Cable Holdings, LLC (2007) 151 Cal.App.4th 1224, 1241.) “The same is true for fraud.” (Id. citing McKell v. Washington Mutual, Inc. (2006) 142 Cal.App.4th 1457, 1471.) “No reason appears why an insurance company should not be subject to similar liability under the UCL if false advertising or similar misrepresentations can be proved.” Id.

“Thus, in Progressive West Ins. Co. v. Superior Court (2005) 135 Cal.App.4th 263, the court — also dealing with a demurrer — analyzed the pleading separately with respect to the sufficiency in alleging UCL unfair business practices, unlawful business practices, and fraudulent business practices.” (Zhang v. Superior Court at 1089.) “Although it acknowledged some doubt as to whether the alleged conduct qualified as ‘unfair,’ it had no difficulty finding that the plaintiff could maintain the UCL claim against the defendant insurer with respect to fraudulent conduct.” (Id.) “We agree with the approach in Progressive West, and to the extent that Textron Financial is inconsistent, we disagree.” (Id.)

Statue of Limitations

Under Insurance Code section 1871.1(l)(1), asserting a violation of this section “may not be filed more than three years after the discovery of the facts constituting the grounds for commencing the action.”

Statute of limitations for claims under Insurance Code section 1871.7 begins running when the plaintiff becomes aware of circumstances that lead the plaintiff to reasonably suspect a factual basis for wrongdoing, thus putting the plaintiff on inquiry notice of the claim. (State of California ex rel. Metz v. CCC Information Services Inc. (2007) 149 Cal. App. 4th 402, 417.)

Useful Rulings on Unfair Insurance Practices Act (UIPA)

Recent Rulings on Unfair Insurance Practices Act (UIPA)

ANTHONY XEPOLIS VS TOKIO MARINE AMERICA INSURANCE COMPANY

¿¿Insurance Code section 790.03 is found in the Unfair Insurance Practices Act (“UIPA”). “The UIPA's operative provision is section 790.02, which states: ‘No person shall engage in this State in any trade practice which is defined in this article as, or determined pursuant to this article to be, an unfair method of competition or an unfair or deceptive act or practice in the business of insurance.’

  • Hearing

ALEX WEINGARTEN VS CERTAIN UNDERWRITERS AT LLOYD'S LONDON SUBSCRIBING TO POLICY NUMBER IML-0114NO-190029, ET AL.

Hartford Accident & Indemnity Co. (1983) 146 Cal.App.3d 926, 936 [failure to accept an offer of settlement or the violation of statutory duties under Insurance Code section 790.03 does not in itself constitute the type of outrageous conduct which will support a cause of action for intentional infliction of emotional distress.) Nor is it outrageous to fail to properly investigate and process an insured’s claim. (Ricard v. Pacific Indemnity Co. (1982) 132 Cal.App.3d 886, 895.)

  • Hearing

  • Type

    Personal Injury/ Tort

  • Sub Type

    Fraud

  • Judge Elaine Lu
  • County

    Los Angeles County, CA

TIMOTHY CURRY VS STATE FARM GENERAL INSURANCE COMPANY

The creation of section 790.03(h) did nothing either to expand or restrict the preexisting common law right of action; the limitation of the utilization of section 790.03 to governmental entities should similarly have no effect upon the common law private right of action.

  • Hearing

  • Type

    Insurance

  • Sub Type

    Intellectual Property

TRAN VS. FARMERS GROUP INC

.; and (4) violations of the Unfair Insurance Practices Act (the "UIPA") under California Insurance Code §§ 790 et seq. (the "FAC") Defendant moves for summary judgment or adjudication on the grounds that: (1) each cause of action is barred by the subject insurance policy's one-year contractual limitations period; (2) Plaintiff is not seeking recoverable relief under her UCL cause of action; and (3) the UIPA does not give rise to a private cause of action.

  • Hearing

  • Type

    Insurance

  • Sub Type

    Intellectual Property

TRAN VS. FARMERS GROUP INC

.; and (4) violations of the Unfair Insurance Practices Act (the "UIPA") under California Insurance Code §§ 790 et seq. (the "FAC") Defendant moves for summary judgment or adjudication on the grounds that: (1) each cause of action is barred by the subject insurance policy's one-year contractual limitations period; (2) Plaintiff is not seeking recoverable relief under her UCL cause of action; and (3) the UIPA does not give rise to a private cause of action.

  • Hearing

  • Type

    Insurance

  • Sub Type

    Intellectual Property

SUSAN FISHMAN, ET AL. VS LIBERTY MUTUAL INSURANCE GROUP, ET AL.

Moving Defendants are not alleged to be insurers per 20 CCR section 2695.9 or the Unfair Insurance Practices Act, Ins. Code section 790.03. Further, there are insufficient facts to support the allegation that CRSC Defendants misrepresented their qualifications, as will be discussed below. Accordingly, Moving Defendants’ demurrers are SUSTAINED with leave to amend as to this cause.

  • Hearing

  • Type

    Personal Injury/ Tort

  • Sub Type

    Fraud

YUN JEONG SIM, INDIVIDUALLY AND DERIVATIVELY ON BEHALF OF WILSHIRE FREMONT CONDOMINIUM HOMEOWNERS ASSOCIATION, A CALIFORNIA NON-PROFIT MUTUAL BENEFIT CORPORATION, ET AL. VS SUSAN AHN, ET AL.

Relying on that rule, Doctors' Co. rejected an insured's effort to allege a conspiracy to violate Insurance Code section 790.03 against an insurer and the attorney (and expert) retained by the insurer to assist with the insured's defense against a third party's claim, explaining that a cause of action for civil conspiracy does not arise "if the alleged conspirator, though a participant in the agreement underlying the injury, was not personally bound by the duty violated by the wrongdoing and was acting only

  • Hearing

LOPEZ VS NATIONAL GENERAL ASSURANCE

The only statute pointed out by the defense was Insurance Code section 790.03, but that concerns unfair competition. For similar reasons, the Plaintiff’s request that the Court evaluate this prong with respect to Penal Code section 484 is also not applicable. The Court does not find Plaintiff’s argument that National General “stole” Mr. Lopez’ money when it denied him coverage.

  • Hearing

KONSTANTINOS KAPNISIS VS COLONY INSURANCE COMPANY, ET AL.

When the Legislature enacted the UIPA, it contemplated only administrative enforcement by the Insurance Commissioner. (Moradi-Shalal, supra, 46 Cal.3d at p. 300.) Private UIPA actions are absolutely barred; a litigant may not rely on the proscriptions of section 790.03 as the basis for a UCL claim. (Cel-Tech, supra, 20 Cal.4th at pp. 182–183; Manufacturers Life, supra, 10 Cal.4th at pp. 283–284; Moradi-Shalal, at p. 304.)

  • Hearing

  • Type

    Insurance

  • Sub Type

    Intellectual Property

VENEGAS, ET AL. V. GEICO INS. AGENCY, INC., ET AL.

Parties are not precluded from bringing “first party UCL actions based on grounds independent from section 790.03, even when the insurer’s conduct also violates section 790.03” and a claim of “insurance bad faith … provide[s] [a] ground for a UCL claim independent from the [Unfair Insurance Practices Act].” (Zhang v. Superior Court (2013) 57 Cal.4th 364, 369.) Defendant’s answer shall be filed within 20 days.

  • Hearing

VENEGAS, ET AL. V. GEICO INS. AGENCY, INC., ET AL.

Parties are not precluded from bringing “first party UCL actions based on grounds independent from section 790.03, even when the insurer’s conduct also violates section 790.03” and a claim of “insurance bad faith … provide[s] [a] ground for a UCL claim independent from the [Unfair Insurance Practices Act].” (Zhang v. Superior Court (2013) 57 Cal.4th 364, 369.)

  • Hearing

PHAT MINH NGUYEN VS ALLIANCE UNITED INSURANCE COMPANY

Plaintiff’s allegations in paragraphs 10-14, and 23-24 directly support a claim for unfair practices under Insurance Code section 790.03, subdivision (h).To the extent that these causes of action are based on Insurance Code section 790.03, Plaintiff cannot relabel their private cause of action for unfair practices under Insurance Code section 790.03 as “Wrongful Handling and Reckless, Willful, and Malicious Failure to Exercise Due Care” to get around Moradai-Shalal’s holding.

  • Hearing

  • Type

    Insurance

  • Sub Type

    Intellectual Property

640 CENTER, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY VS AMGUARD INSURANCE COMPANY, A PENNSYLVANIA CORPORATION ET AL.

Moreover, in response to Defendant’s argument that Plaintiff has simply omitted reference to the Unfair Insurance Practice Act (“UIPA”) and alleged a UIPA violation under the label of a UCL violation, Zhang expressly approves such a procedure, so long as the conduct alleged also violates some statute other than the UIPA. (Id. at 382-384.) Here, Defendant’s alleged conduct also violates other sections of the Insurance Code and common-law bad faith principles.

  • Hearing

WUN-LING CHANG, M.D., INC. VS BLUE CROSS OF CALIFORNIA, ET AL.

Section 790.03(h)(3) defines as an “unfair method[] of competition and unfair and deceptive act[] or practice[] in the business of insurance” an insurer’s knowing “fail[ure] to adopt and implement reasonable standards for the prompt investigation and processing of claims arising under insurance policies.” The allegations above, however, while seemingly overlapping in part with the conduct prohibited by §790.03(h)(3), also are broader. In Zhang v.

  • Hearing

  • Type

    Insurance

  • Sub Type

    Intellectual Property

XXXXXXXX VS INTERINSURANCE EXCHANGE OF THE AUTOMOBILE CLUB OF SOUTHERN CALIFORNIA

App. 4th 403 (Coleman ), the court held that an insurer's conduct - misleading the plaintiffs as to the applicable statute of limitations and advising the plaintiffs not to obtain the services of an attorney - did not reach the level of outrageousness necessary to support a cause of action for intentional infliction of emotional distress; plaintiffs' claims were based on violations of statutory duties under Insurance Code section 790.03, and it was "well-settled" that the violation of those statutory duties

  • Hearing

  • Type

    Contract

  • Sub Type

    Breach

XXXXXXXX VS INTERINSURANCE EXCHANGE OF THE AUTOMOBILE CLUB OF SOUTHERN CALIFORNIA

App. 4th 403 (Coleman ), the court held that an insurer's conduct - misleading the plaintiffs as to the applicable statute of limitations and advising the plaintiffs not to obtain the services of an attorney - did not reach the level of outrageousness necessary to support a cause of action for intentional infliction of emotional distress; plaintiffs' claims were based on violations of statutory duties under Insurance Code section 790.03, and it was "well-settled" that the violation of those statutory duties

  • Hearing

  • Type

    Contract

  • Sub Type

    Breach

PEDRO A ORTIZ VS PERFORMANCE FOOD GROUP INC ET AL

There, the Court ruled that (1) Plaintiff had alleged insufficient facts to support his punitive damages claim, (2) Plaintiff was entitled to attorney fees only on his bad faith claim, and (3) Plaintiff could not recover damages under Insurance Code section 790.03. State Farm’s motion to strike is granted in part. Pursuant to this motion, the Court strikes the FAC’s prayer for punitive damages, prayer for attorney fees except for Brandt fees, and references to Insurance Code section 790.03.

  • Hearing

  • Type

    Personal Injury/ Tort

  • Sub Type

    other

UBIQUITI NETWORKS, INC. V. NATIONAL UNION FIRE INS. CO. OF PITTSBURGH, PA

Companies (1988) 46 Cal.3d 287, essentially “overruled Colonial” because one of the causes of action at issue in Colonial was premised on Insurance Code section 790.03, subdivision (h), and the Moradi-Shalal court held that section 790.03 was not intended to create a private civil cause of action against an insurer.

  • Hearing

MARK PROCESS VS RICHARD RAWLINGS, ET AL.

Therefore, Plaintiff’s claim against Allstate for violation of Insurance Code section 790.03 fails as a matter of law. Plaintiff offers no response in opposition. Accordingly, Allstate’s demurrer is SUSTAINED without leave in its entirety. Motion to Strike Standard Any party, within the time allowed to respond to a pleading may serve and file a notice of motion to strike the whole or any part thereof. (CCP § 435(b)(1); Cal. Rules of Court, Rule 3.1322(b).)

  • Hearing

COAST NATIONAL INSURANCE COMPANY VS BERNANDINO CAMBRAY FLORE

On review of the Seventh Cause of Action, the Court notes that Flores is not seeking liability for a general Insurance Bad Faith claim, but is specifically seeking liability for violation of the proscriptions laid out in Insurance Code §709.03(h), under the Unfair Insurance Practices Act (the “Act”). Specifically, Flores is alleging the violation of Ins. Code §§709.03(h)(1)-(6), (12), & (13).

  • Hearing

PERRY COHAN, ET AL. VS STATE FARM GENERAL INSURANCE COMPANY, AN ILLINOIS CORPORATION

However, “Private UIPA actions are absolutely barred; a litigant may not rely on the proscriptions of section 790.03 as the basis for a UCL claim.” (Zhang v. Superior Court (2013) 57 Cal.4th 364, 384.) The Cohans’ FAC largely argues that their cause of action under the UCL is based on violations of the Unfair Insurance Practices Act (“UIPA”), Insurance Code section 790.03. (FAC ¶ 55.) As State Farm argues, and the Court agrees, UCL claims may not be based on violations of UIPA. (Zhang v.

  • Hearing

  • Type

    Insurance

  • Sub Type

    Intellectual Property

EDDIE ELLOIE VS STATE FARM GENERAL INSURANCE COMPANY

Damages for Violation of Insurance Code Section 790.03 State Farm contends that Plaintiff has no right to damages under Insurance Code section 790.03 because that section does not provide a private right of action. State Farm is correct. (Moradi-Shalal v. Fireman's Fund Ins. Companies (1988) 46 Cal.3d 287 (holding that Unfair Insurance Practices Act (“UIPA”) (Ins.

  • Hearing

  • Type

    Personal Injury/ Tort

  • Sub Type

    Fraud

OSCAR MALDONADO, ET AL. VS ANTHEM BLUE CROSS AND BLUE SHIELD, ET AL.

Superior Court (1988) 47 Cal.3d 473, the California Supreme Court held that ERISA preempts a surviving private cause of action brought under California Insurance Code section 790.03, subdivision (h), when the action asserts a claim arising from an employee benefit plan. 47 Cal.3d at p. 484; see Moradi–Shalal v. Fireman's Fund Ins. Companies (1988) 46 Cal.3d 287 [prospectively eliminating private causes of action under Ins.Code, § 790.03, subd. (h) ].)

  • Hearing

  • Type

    Insurance

  • Sub Type

    Intellectual Property

KONSTANTINOS KAPNISIS VS COLONY INSURANCE COMPANY, ET AL.

Conduct Based on Violation of UIPA Colony argues that this cause of action fails because it is an impermissible attempt to plead around the holding of the landmark case Moradi-Shalal v. Fireman’s Fund Ins. Companies (1988) 46 Cal.3d 287, 304 which held that the Unfair Insurance Practices Act (“UIPA”) does not create a private cause of action for commission of the various unfair practices listed in Insurance Code section 790.03. (Dem. at 4.) Colony is partly correct.

  • Hearing

  • Type

    Insurance

  • Sub Type

    Intellectual Property

WESTFALL V. FARMERS INSURANCE COMPANY

Code] section 790.03, even when the insurer's conduct also violates section 790.03,” discussed both the UCL in general and the limitations under Moradi-Shalal and its progeny in explaining its conclusions. The long, detailed explanation provides a thorough discussion of the court’s view on UCL, or claims for unfair business practices, under Business and Professions Code sections 17200 and 17500.

  • Hearing

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