Opinion ID: 2651525
Heading Depth: 3
Heading Rank: 2

Heading: Arguable or legitimate basis

Text: As noted above, whether an insurer possessed an arguable or legitimate reason is a question of law. Wigginton, 964 F.2d at 492 (citation omitted); Jenkins v. Ohio Cas. Ins. Co., 794 So. 2d 228, 232-33 (Miss. 2001). “Arguable reason is defined as nothing more than an expression indicating the act or acts of the alleged tortfeasor do not rise to [the] heightened level of an independent tort.” Caldwell, 686 So. 2d at 1096 (citation and internal quotation marks omitted). The initial burden placed on the insurer is low: it “need only show that it had reasonable justifications, either in fact or in law” for its actions. Wigginton, 964 F.2d at 492 (citation omitted). Once an insurance company articulates an arguable or legitimate reason for its payment delay, the insured bears the burden of demonstrating that the insurer had no arguable reason. Caldwell, 686 So. 2d at 1097. “The plaintiff’s burden in this respect likewise exists at the summary judgment stage where the insurance company presents an adequate prima facie showing of a reasonably arguable basis for denial so as to preclude punitive damages.” Id. at 1097 n.1 (citation omitted). Whether a claimant has proven an insurer acted without a reasonable or arguable basis is determined by a preponderance of the evidence. See, e.g., Miss. 7 Case: 11-60458 Document: 00512514313 Page: 8 Date Filed: 01/28/2014 No. 11-60458 Power & Light Co. v. Cook, 832 So. 2d 474, 484 (Miss. 2002) (approving of jury instructions that used preponderance of the evidence standard); Mut. Life Ins. Co. of N.Y. v. Estate of Wesson, 517 So. 2d 521, 530 (Miss. 1987), abrogated on other grounds by Gen. Am. Life Ins. Co. v. McCraw, 963 So. 2d 1111, 1114 (Miss. 2007) (same).6