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Category Archives: Liability Coverage

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Is It Time for a Codified Insured-Insurer Privilege?

Posted in Liability Coverage
There is no common law “Insured-Insurer privilege” that protects communications between them, such as the privilege that exists for spousal communications or attorney client communications. Did you know that in some jurisdictions an insured who is being provided a defense by an insurer under a reservation of rights could risk the waiver of attorney client … Continue Reading

CLIENT QUESTIONS REGARDING POLICY INTERPRETATIONS

Posted in Liability Coverage
One of the more common questions that clients ask coverage counsel is how a court will interpret a new policy provision. This is especially true of clients that make a point of using the latest endorsements which may not have been tested in a particular state's courts. The issue is complicated by the different policy interpretation approaches taken by different states, which make it difficult to apply out of state law even when the particular policy provision at issue is identical to one interpreted in a case from another jurisdiction. In states like Oregon and Washington, where case law interpreting newer policy language may be scarce, insurers can put themselves at increased risk if they rely too heavily on their own interpretation of the policy's "plain meaning" or their experience in other jurisdictions… Continue Reading

Liability Caused by Hackers Not Covered by CGL Policies

Posted in Liability Coverage
Summary judgment was granted in favor of insurers (including Zurich and Mitsui Sumitomo), against Sony in a case of first impression on the issue of insurance coverage for cyber liabilities under commercial general liability primary policies. The New York state court ruled that primary insurers are not obligated to defend Sony against lawsuits brought by … Continue Reading

Busy Month for NY Court of Appeals

Posted in Liability Coverage
  There’s been a good deal of activity in New York’s high court this February. Here’s the round-up: K2 Investment Group, LLC v. American Guarantee & Liability Ins. Co.: In this much-anticipated decision, the Court of Appeals declined to overrule Servidone Const. Corp. v. Security Ins. Co. of Hartford, 64 NY2d 419 (1985), by holding that an … Continue Reading

Can only the named insured satisfy the SIR, or can it be satisfied by other insurance or by the payment of a contractual indemnitor?

Posted in Liability Coverage
In its simplest terms, a self insured retention (“SIR”)  is an agreed sum that the insured agrees to pay before the insurance policy is required to respond to the loss.    Can only the named insured satisfy the SIR, or can it be satisfied by other insurance, by the payment of a contractual indemnitor or by a … Continue Reading

Missouri Bar Against Negligence Claims Against Churches Bars Coverage For Clergy Abuse Suit

Posted in Liability Coverage
When is it unreasonable for an insurer to benefit from a policyholder’s legal strategy in defending the underlying claim that the insurer is contesting coverage for? That was the question posed to the U.S. Court of Appeals for the Eighth Circuit in its consideration of a recent Missouri sexual abuse case in Chicago Ins. Co. v. … Continue Reading

Excess Insurance and Umbrella Coverage: When Is the Defense Duty Triggered?

Posted in Liability Coverage
          Pure Excess and Umbrella liability insurance are often confused for the same thing, and the terms routinely are used interchangeably.  In fact, umbrella coverage is often just a type of excess insurance that provides coverage different than pure excess insurance.  Usually, an umbrella policy may provide pure excess insurance under … Continue Reading

More on Insurance and Indemnity Contracts

Posted in Liability Coverage
Diane’s October 18 post points up the distinction between insurance and indemnity contracts, and calls to mind another important point about these risk transfer mechanisms: to the extent that insurance and indemnity contracts operate independently of each other (a question apparently to be taken up by the Texas Supreme Court), they may not be co-extensive … Continue Reading

Additional Insured Status And Contractual Indemnity Provisions: Are You Really Covered?

Posted in Liability Coverage
“Additional insured” provisions are one of the most prevalent risk shifting techniques used in the insurance field today. Yet surprisingly, they remain one of the least understood for insurers, courts, and insureds. While debate in Oregon case law over the legal status of additional insured provisions has quieted down since the Oregon Supreme Court’s decision … Continue Reading

New Jersey Supreme Court Recognizes Right of Equitable Contribution

Posted in Liability Coverage
The New Jersey Supreme Court has ruled that a settlement that a non-defending insurer entered into with its policyholder did not preclude a defending insurer from bringing an equitable contribution to recover its costs of defense. In Potomac Ins. Co. of Illinois v. OneBeacon Ins. Co., A-2-12 (N.J. September 16, 2013), the court declared that … Continue Reading

TCPA Damages are Remedial, Not Penal, According to Illinois Supreme Court

Posted in Liability Coverage
  The Illinois Supreme Court issued a ruling today, in Standard Mutual Insurance Company v. Lay, 2013 IL 114617 (2013), finding that a TCPA statutory award is remedial in nature, and not penal. Therefore, it reversed the Appellate Court’s determination that the TCPA-prescribed damages of $500 per violation constitutes punitive damages which are not insurable as … Continue Reading

Horizontal exhaustion bumps up against anti-stacking

Posted in Liability Coverage
Asbestos claims coverage litigation pits policyholders against insurers, and insurers against insurers, and raises novel issues and complex interaction between insurance concepts, policy language, and common sense. In the latest from the ongoing saga of Kaiser Cement and Truck Insurance – Kaiser Cement & Gypsum Corp. v. Ins. Co. of the State of PA / Truck … Continue Reading

Are TCPA Penalties Uninsurable? How about Punitive Damages?

Posted in Liability Coverage
    The Illinois Supreme Court will soon be addressing whether the statutory penalty of $500 per faxed advertisement allowed under the TCPA is in the nature of punitive damages and uninsurable. It is anticipated that the Supreme Court will  also address the insurability of punitive damages generally, an issue never squarely addressed by the Supreme Court. … Continue Reading

The Case of the Vanishing Self-Insured Retention

Posted in Liability Coverage
Rather than declaring that self-insurance is void as against the public policy of Rhode Island, the Supreme Court instead interpreted 42-14.1-2(a) as only allowing self-insurance to the extent that it is permitted by regulations issued by the Department of Business Regulation. As the DBR has not promulgated any such regulations to date, the court declined to give effect to the SIR provisions in the Columbia Casualty policy… Continue Reading

Can a False Advertising, Patent or Trademark Infringement Claim Be Viewed as a Claim for “Implied Disparagement” that Triggers a Duty To Defend?

Posted in Liability Coverage
Seeking to expand coverage or to avert an IP exclusion, some policyholders have recast claims for unfair competition, patent or trademark infringement as “implied disparagement” claims in order to trigger a duty to defend under the “personal and advertising injury” coverage.  They have met with mixed success.  For example, falsely advertising one’s own product does not constitute … Continue Reading

South Carolina Supreme Court Upholds CD Statute But Only Prospectively

Posted in Liability Coverage
Insurance coverage practitioners in South Carolina may hardly be blamed if  suffer headaches from the vertiginous swings of the South Carolina Supreme Court with respect to the scope and availability of coverage for construction defect claims.  In a series of rulings over the past several years, the state Supreme Court has “clarified” the law several … Continue Reading

A TCPA Penalty can be Awarded (and Trebled!) Irrespective of Whether the Claimant ever Received the Unwanted Fax Advertisement.

Posted in Liability Coverage
  Most wires have picked up the Georgia Supreme Court’s decision in  A FAST SIGN COMPANY, INC., d/b/a FASTSIGNS v. AMERICAN HOME SERVICES, INC., S11G1708 (Nov. 5, 2012), because it involved a $459 million dollar judgment against a fax blaster for sending 306,000 unsolicited fax advertisements.   That dollar amount may be staggering, but the bigger news … Continue Reading

Massachusetts Court Rejects Higher Hourly Rate For National Counsel

Posted in Liability Coverage
A new federal district court opinion from Massachusetts may lend guidance to insurers in addressing the not uncommon issue of how to reimburse independent counsel in complex commercial litigation where the insured is represented both by local counsel and a large national law firm. In Vicor Corp. v. Vigilant Ins. Co., 7-10517 (D. Mass. September 28, … Continue Reading

My Week In the WayBack Machine

Posted in Liability Coverage
Those of us who grew up watching TV in the 1960 fondly recall the WayBack Machine, a device that Mr. Peabody (a bow tie wearing dog–alright, it WAS the 60s) used to travel back in time on the Rocky and Bullwinkle Show.  Until I read two new opinions this week from Indiana and New Mexico, however, … Continue Reading