Fireman’s Fund Insurance Company, Plaintiff-Respondent and Cross-Appellant v. Security Insurance Company of…

Summary

The Supreme Court of New Jersey affirmed the lower courts, holding that when an insurer breaches its implied covenant of good faith by refusing to settle a claim that far exceeds policy limits, the insurer forfeits its contractual right to control settlement and is liable for the policy limits to the insured for a reasonable good‑faith settlement. The court declined to award punitive damages.