Note: This article was originally published by Law360 as an Expert Analysis column.
Like most jurisdictions, Kentucky follows the general rule that an insurance bad faith claim cannot be maintained against an insurance company when the underlying claim is not covered by the policy. See Davidson v. Am. Freightways, Inc., 25 S.W.3d 94, 100 (Ky. 2000).
While courts on some issues may seem bent on finding coverage, there are some notable exceptions. Courts generally have faithfully applied claims-made-and-reported provisions even when an insured has had continuous coverage. An Arkansas federal district court recently did just that when it concluded that a school district failed to give its insurer timely notice of a claim under consecutive claims-made-and-reported policies.