FRANKENMUTH MUTUAL INSURANCE COMPANY v. Keeley

ON REHEARING

Riley, C.J.

We granted rehearing1 after our decision in Frankenmuth Mutual Ins Co v Keeley, 433 Mich 525, 528; 447 NW2d 691 (1989), in which we reversed the decision of the Court of Appeals and held "that when an insurer has exhibited bad faith in failing to settle a claim on behalf of its insured, and a judgment in excess of the policy limits results, the insurer is liable for the excess without regard to whether the insured has the capacity to pay.” After hearing oral arguments on rehearing, this Court remanded the instant case to the trial court to determine whether…