Facts

Plaintiff Professional Building Contractors (PBC) sought insurance coverage to settle a lawsuit brought against it by a homeowner. PBC allegedly failed to cover a roof properly, resulting in substantial rain and water damage to the house's interior. PBC paid $106,000 to repair the house and $250,000 to settle the lawsuit.

Defendant Essex Insurance Company denied coverage for the cost of repair, claiming PBC settled the suit without Essex' consent. Essex filed a declaratory judgment against PBC, claiming Essex had no duty to defend homeowner claims. Essex provided a defense under a reservation of rights and sought reimbursement of defense costs.

PBC countersued for bad faith denial of coverage.

Result

The jury awarded Professional Building Contractors $2.5 million in punitive damages and $682,264 in compensatory damages, which included $324,000 in attorneys' fees.