Raymond H. Pierson, III v. CSAA Insurance Services, Inc., et al.

The California Legislature as evidenced in the Insurance Code 11580(b)(2) and the binding caselaw precedent (Moradi'Shalal v. Fireman’s Fund Ins. Co., 46 Cal. 3d 287) of the Supreme Court of California have instituted a broad and impenetrable barrier for injured third parties which has blocked their proceeding directly in litigation against a tortfeasor’s insurer prior to achieving a judgment against the tortfeasor. That barrier is maintained even in those circumstances where there is the presence of indisputable evidence of definitive and foreseeable injury caused to that third party by the direct actions of the insurer which has flagrantly breached its duty to the insured under the implied covenant of good faith and fair dealing due to that insurer’s failure to settle the litigation under a policy limit offer extended by the injured third party. Under California law the only exception to this imposing moat of protection provided to insurers is the assignment by the insured to the injured third party of their “cause of action for breach of the duty to settle”