As Law360 recently reported, the South Carolina Supreme Court delivered a gift to insurers facing bad faith claims in that state. The court determined that, where a policyholder brings a bad faith claim against its insurer and the insurer answers the claim by denying liability, the policyholder’s right to obtain discovery of the insurer’s attorney-client privileged communications concerning the insurer’s handling of the claim must be determined on a case-by-case basis.

Despite the court’s best efforts to balance competing concerns and reach a relatively innocuous holding, this decision will only invite more insurance-related discovery disputes in the future, while encouraging insurers to utilize outside lawyers for claims investigation and handling who are not acting in the policyholders’ best interests. Click here to read the full article on Law360.*

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