In Cohan v. Provident Life & Acc. Ins. Co., 140 F.Supp.3d 1063, page numbers to be provided by Westlaw (D. Nev. 2015), a federal District Judge held that a genuine dispute over coverage under a disability insurance policy was a good defense to claims alleged under an unspecified "unfair trade practices" act:
Unum argues that, pursuant to the genuine dispute doctrine, its handling of Cohan's claim cannot be considered either to have been in bad faith or an unfair trade practice. A claim for bad faith must fail if a genuine dispute exists whether an insured is covered under a policy. (Citation omitted.) At issue is not whether the insured was covered under the policy, but only whether a reasonable and legitimate dispute exists as to that coverage. In the context of the facts of the present case, the existence of a genuine dispute also requires dismissal of an unfair trade practices claim.
It is interesting to note that, as described by the carrier and by the federal judge in this Nevada case, whether a genuine dispute exists over coverage is not merely a "defense;" it is a "doctrine."
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