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  5. 846 P.2d 118 (1993)
 

UNDERWRITERS v. THE NARROWS

Nos. S-4388, 4723.

846 P.2d 118 (1993)

UNDERWRITERS AT LLOYD'S LONDON, Appellant, v. THE NARROWS, L & L Enterprises, a Partnership composed of Jeanne L. Lindley and Carson E. Lindley, d/b/a The Narrows, Jeanne L. Lindley, Carson E. Lindley, Appellees.

Supreme Court of Alaska.

Rehearing Denied February 23, 1993.

Attorney(s) appearing for the Case

Leo W. Fraser, Mendes & Mount, New York City, Robert L. Eastaugh, Delaney, Wiles, Hayes, Reitman & Brubaker, and Leroy J. Barker, Robertson, Monagle & Eastaugh, Anchorage, for appellant.

Murphy L. Clark, Clark, Walther & Flanigan, Anchorage, for appellees.

Before RABINOWITZ, BURKE, MATTHEWS and COMPTON, JJ.

OPINION

BURKE, Justice.

I. INTRODUCTION

The Narrows, a bar, restaurant and residence owned by Jeanne L. Lindley and Carson E. Lindley, was destroyed by fire in May 1989. After their proof of loss claim was rejected, the Lindleys (hereinafter "the insured") sued Underwriters1 alleging breach of contract and a "bad faith" refusal to pay on their claim.2

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