“And I would have gotten away with it too if it wasn’t for you meddling kids!”

“And I would have gotten away with it too if it wasn’t for you meddling kids!”

Both of those cultural staples come to mind in revisiting the Mississippi Supreme Court’s 2020 decision in Travelers Prop. Cas. Co. of Am. v. 100 Renaissance, LLC, 308 So. 3d 847 (Miss. 2020). The court in Travelers determined that ghostwriting by in-house counsel amounted to a waiver of attorney-client privilege.

At the time of our initial summary of the Travelers decision, the 7-2 decision was pending a Motion for Rehearing. The Mississippi Supreme Court has since denied the motion en banc. The Travelers decision stemmed from a claim handler’s deposition testimony that she could not explain the denial letter issued to Renaissance 100. Specifically, the claim handler testified that she did not have any knowledge of the reasons for denial or of Mississippi’s auto liability laws or uninsured motorist laws that were referenced in the denial letter. Travelers ultimately took the position the coverage denial was issued to Renaissance 100 in good faith because it was based on the advice of in-house counsel. Upholding the trial court’s decision, the Mississippi Supreme Court determined that Travelers had waived its attorney-client privilege. The court reasoned that if Travelers’ in-house counsel was who actually wrote the denial letter, then such ghostwriting for the claims handler did not constitute protected legal counsel and advice. The court concluded that Renaissance 100 should be allowed to depose Travelers’ in-house as the person who had personal knowledge of Travelers’ reasons for denying Renaissance 100’s claim. Though the court interestingly did not address whether the work product protection was waived by in-house counsel’s preparation of the denial letter. Ultimately, Renaissance 100 (i.e., our meddling kids here) effectively unmasked Travelers’ claim handler to get at the person really responsible for denying its claim.

The obvious concern here was best captured in the Travelers dissent, which expressed concern for the “deleterious and chilling” impact the decision could have on insurance companies. Undoubtedly, the Travelers decision will result in insurers’ hesitancy to seek coverage opinions from in-house and outside counsel alike. So how can insurers avoid an unwitting waiver of attorney-client privilege? One safeguard is avoidance by in-house counsel of crossing the line into actually performing the functions of an adjuster, which was arguably the case in Travelers.

Equally important is ensuring that the claim handler has personal knowledge and understanding of the reasons for denial independent from in-house counsel. In Travelers, the coverage letter at issue provided that the policy did not provide coverage based in part on review and interpretation of the law and directly cited Mississippi’s UM statute. While it may be worthwhile for the claim adjuster to be able to discuss applicable legal standards, at least at a surface level, that went into any coverage analysis, the Travelers decision seems to indicate that initial coverage letters should be limited to the applicable policy language, without reference to statutes or case law that the adjuster may not be able to readily explain at a deposition. Overall, the Travelers decision highlights the importance of the insurance company, not its in-house or outside counsel, ultimately determining coverage and being prepared to defend it in litigation.

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