Williams v. GEICO Casualty Co.

[INSURANCE LAW

In Williams v. GEICO Casualty Co.,[1] the supreme court held that an insurer has a duty to not seek settlements that do not release all insureds.[2] In 2000, Landt, an insured driver, ran over a man lying on the road.[3] Dushkin was a passenger in the truck at the time.[4] GEICO offered to settle with the decedent’s estate for the full policy limit of $50,000 in exchange for the release of liability for both Landt and Dushkin.[5] When a settlement agreement could not be reached, GEICO filed for declaratory judgment.[6] On appeal, the Shapsnikoffs argued that GEICO had a duty to offer or accept a settlement releasing Landt from liability even if so doing would leave Dushkin still liable.[7] The supreme court affirmed the lower court’s decision, reasoning that Dushkin may have been an insured under a theory presented by the Shapsnikoffs.[8] Thus, GEICO incurred a duty of good faith and fair dealings to Dushkin when they agreed to defend him.[9] The court further reasoned that this meant GEICO had a duty not to seek settlements that did not release both Landt and Dushkin because bad faith claims could result otherwise.[10] Affirming the lower court’s decision, the supreme court held that an insurer has a duty not seek settlements that do not release all insureds.[11]


[1] 301 P.3d 1220 (Alaska 2013).

[2] Id. at 1226.

[3] Id.

[4] Id.

[5] Id. at 1223–24.

[6] Id.

[7] Id.

[8] Id. at 1226.

[9] Id.

[10] Id.

[11] Id. at 1226.

Williams v. GEICO Casualty Co.

[INSURANCE LAW

In Williams v. GEICO Casualty Co.,[1] the supreme court held that an insurer has a duty to not seek settlements that do not release all insureds.[2] In 2000, Landt, an insured driver, ran over a man lying on the road.[3] Dushkin was a passenger in the truck at the time.[4] GEICO offered to settle with the decedent’s estate for the full policy limit of $50,000 in exchange for the release of liability for both Landt and Dushkin.[5] When a settlement agreement could not be reached, GEICO filed for declaratory judgment.[6] On appeal, the Shapsnikoffs argued that GEICO had a duty to offer or accept a settlement releasing Landt from liability even if so doing would leave Dushkin still liable.[7] The supreme court affirmed the lower court’s decision, reasoning that Dushkin may have been an insured under a theory presented by the Shapsnikoffs.[8] Thus, GEICO incurred a duty of good faith and fair dealings to Dushkin when they agreed to defend him.[9] The court further reasoned that this meant GEICO had a duty not to seek settlements that did not release both Landt and Dushkin because bad faith claims could result otherwise.[10] Affirming the lower court’s decision, the supreme court held that an insurer has a duty not seek settlements that do not release all insureds.[11]


[1] 301 P.3d 1220 (Alaska 2013).

[2] Id. at 1226.

[3] Id.

[4] Id.

[5] Id. at 1223–24.

[6] Id.

[7] Id.

[8] Id. at 1226.

[9] Id.

[10] Id.

[11] Id. at 1226.