New York law unequivocally empowers policyholders to demand discovery of nearly all documents and communications authored by insurers or their consultants before a denial of coverage by prohibiting insurers from claiming work-product protection over such material.
While Insurers routinely contend that this prohibition applies equally to policyholders in discovery disputes, a recent decision by Judge Jesse Furman in the Southern District of New York clarifies that this limitation on the scope of work product “applies to insurers … and not to insureds.” Tower 570 v. Affiliated FM Insurance, No. 20-CV-0799 (JMF), 2021 WL 1222438, at *4 (S.D.N.Y. Apr. 1, 2021) (emphasis original). This means that policyholders can seek discovery into insurers’ pre-denial claims adjustment without opening the door to disclosure of their own sensitive and privileged coverage analysis.
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