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Mealey's Insurance

  • April 20, 2018

    Excess Insurer Owes More Than $55M For Environmental Contamination Claims

    NEW YORK — A New York federal judge on April 18 determined that an excess insurer owes its insured more than $55 million for environmental contamination costs incurred by the insured after an offset of approximately $2.6 million is applied based on the insured’s global settlement with its other insurers (Olin Corp. v. Lamorak Insurance Co., et al., No. 84-1968, S.D. N.Y., 2018 U.S. Dist. LEXIS 65446).

  • April 20, 2018

    Claimant Opposes Insurer’s Bid For Protection Of Injunction For Asbestos Claims

    WILMINGTON, Del. — A motion by an asbestos liability insurer of former Chapter 11 debtor W.R. Grace & Co. to enforce the protective injunction in the debtor’s reorganization plan to halt claimants in Montana from pursuing asbestos claims against the insurer should be stayed or dismissed because it is procedurally unsound and untimely, considering that the same issue is about to be decided by the Third Circuit U.S. Court of Appeals, a claimant told a Delaware federal bankruptcy court on April 17 (In re:  W.R. Grace & Co., et al., No. 01-01139, D. Del. Bkcy.).

  • April 19, 2018

    Washington Federal Judge Says Nonsettling Insurers’ Interests Are Protected

    SEATTLE — A Washington federal judge on April 16 approved an insured’s settlements with two insurers in an environmental contamination dispute and refused to allow the nonsettling insurers to seek contribution from the settling insurers because settlements adequately protect the interests of the nonsettling insurers (King County v. Travelers Indemnity Co., et al., No. 14-1957, W.D. Wash., 2018 U.S. Dist. LEXIS 64763).

  • April 19, 2018

    11th Circuit Vacates Ruling On Water Exclusion, Says District Court Erred

    ATLANTA — The 11th Circuit U.S. Court of Appeals on April 16 vacated a district court’s ruling that coverage is barred for water damage caused by a collapsed pipe after determining that the policy’s water exclusion does not apply to water damage caused by a failure within the property’s plumbing system (Ken Cameron and Michelle Cameron v. Scottsdale Insurance Co., No. 17-11907, 11th Cir., 2018 U.S. App. LEXIS 9800).

  • April 19, 2018

    Insurer Seeks Reconsideration Of Reinsurance Duties For $3.2M Asbestos Settlement

    SYRACUSE, N.Y. — In a dispute over whether a reinsurer is obligated to an insurer for more than $3.2 million in reinsurance proceeds for an underlying asbestos settlement, the insurer in an April 3 motion seeks reconsideration of a New York federal judge’s finding of ambiguity in the reinsurance certificate provisions related to expense (Utica Mutual Insurance Co. v. Munich Reinsurance America Inc., Nos. 12-00196 & 13-00743, N.D. N.Y.).

  • April 18, 2018

    Kaiser Gypsum Insurer Proposes Plan With Asbestos Settlement, Litigation Options

    CHARLOTTE, N.C. — The primary insurer of Chapter 11 debtor Kaiser Gypsum Co. asked a North Carolina federal bankruptcy court April 17 to approve the disclosure statement for its plan of reorganization for Kaiser Gypsum, which failed to file its own plan, instead seeking to lift the bankruptcy stay so asbestos claimants can pursue their claims in the tort system, but only if they agree to have their settlements or judgments paid by the debtor’s insurers (In re Kaiser Gypsum Company, Inc., et al., No. 16-31602, W.D. N.C. Bkcy.).

  • April 17, 2018

    5th Circuit Certifies Questions About Voluntary Payment To Mississippi High Court

    NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on April 16 certified two questions to the Mississippi Supreme Court regarding whether Mississippi’s voluntary payment doctrine bars an insurer from recovering a settlement payment made on behalf of an additional insured when the insurer disputes that the additional insured was actually covered for the settlement under the applicable policy (Colony Insurance Co. v. First Specialty Insurance Corp., No. 17-60094, 5th Cir., 2018 U.S. App. LEXIS 9444).

  • April 16, 2018

    Policies’ Anti-Assignment Clauses Do Not Bar Coverage For Environmental Claims

    TRENTON, N.J. — Insurers of an insured whose company was sold to another company in 1986 cannot rely on the policies’ anti-assignment clauses to deny coverage for environmental claims arising out of their insured’s business because the insured’s liability for the contamination attached prior to the sale of the company and during the applicable policies’ periods, the New Jersey Superior Court Appellate Division said April 13 (Cooper Industries LLC v. Columbia Casualty Co., et al., No. A-0593-15T1, N.J. Super., App. Div., 2018 N.J. Super. Unpub. LEXIS 868).

  • April 16, 2018

    Insurer, Reinsurer Propose Revised Schedule For Asbestos Coverage Dispute

    SYRACUSE, N.Y. — An insurer on April 13 wrote to a New York federal court proposing a new schedule in an asbestos coverage case with its reinsurer in response to a ruling ordering document production (Utica Mutual Insurance Co. v. R&Q Reinsurance Co., No. 15-270, N.D. N.Y.).

  • April 16, 2018

    New York Justice: Reinsurance Contracts Capped For Cedent’s Asbestos Losses

    ROME, N.Y. — A New York justice on March 7 ruled that a cedent is not entitled to asbestos loss and expenses beyond the stated coverage amount set forth in reinsurance certificates issued by members of a reinsurance pool (Utica Mutual Insurance Co. v. Abeille General Insurance Co., et al., No. CA2013-002320, N.Y. Sup., Oneida Co.).

  • April 12, 2018

    Federal Judge: Insureds’ Property Damage Occurred Prior To Policy Period

    MIAMI — An all-risk commercial property insurance policy does not provide coverage for property damage to a building that occurred gradually over an extended period, a Florida federal judge ruled April 10, noting that insureds knew of the gradual deterioration before the date they allege the collapse occurred (The S.O. Beach Corp., et al. v. Great American Insurance Company of New York, No. 17-22254, S.D. Fla., 2018 U.S. Dist. LEXIS 60235).

  • April 12, 2018

    Judge Stays Coverage Dispute Pending Resolution Of Canadian Lawsuits

    NEW YORK — After finding that disputes over insurers’ alleged duty to defend and indemnify were not ripe for consideration, a New York federal judge on March 31 declined to rule on summary judgment motions and stayed the case pending the outcome of underlying property damage litigation pending in Canada (Lafarge Canada Inc. v. American Home Assurance Co., No. 15-CV-8957, S.D. N.Y., 2018 U.S. Dist. LEXIS 56123).

  • April 11, 2018

    Insurer Must Prove It Was Prejudiced By Insured’s Late Notice Of Saltwater Spill

    WICHITA, Kan. — A Kansas federal judge on April 9 granted an insured’s motion for summary judgment in a pollution liability suit arising out of a saltwater spill after determining that the insurer is required to prove that it was prejudiced by the insured’s late notice of the spill (PetroSantander (USA) Inc. v. HDI Global Insurance Co. et al., No. 16-1320, D. Kan., 2018 U.S. Dist. LEXIS 59696).

  • April 10, 2018

    Judge: Insurer Can’t Rely On Fraudulent Misjoinder In Removal Of Bad Faith Suit

    GREENVILLE, Miss. — An insurer may not rely on the doctrine of fraudulent misjoinder as a basis for removal jurisdiction, a federal judge in Mississippi ruled April 5 in remanding an insurance breach of contract and bad faith lawsuit to state court (Kenneth Strachan, et al. v. State Farm Fire and Casualty Co., et al., No. 17-0138, N.D. Miss., 2018 U.S. Dist. LEXIS 58226).

  • April 10, 2018

    Insured Breached Voluntary Payment Provisions By Choosing Environmental Consultant

    LAFAYETTE, Ind. — Insurers involved in an environmental contamination coverage dispute did not waive their right to select an environmental consultant to address remediation of the contamination on the insured’s site because the insured voluntarily chose its own environmental consultant in breach of the policies’ voluntary payment provisions, an Indiana federal judge said March 28 (Ranburn Corp. v. Argonaut Insurance Co., et al., No. 16-88, N.D. Ind., 2018 U.S. Dist. LEXIS 51658).

  • April 10, 2018

    All-Sums Method Of Allocation Applies In Asbestos Coverage Suit

    NORFOLK, Va. — A Virginia federal judge on April 2 agreed with an insured seeking coverage for underlying asbestos liabilities that an all-sums method of allocation applies to its policies and that the policies are subject to vertical exhaustion (Hopeman Brothers Inc., v. Continental Casualty Co., et al., No. 16-187, E.D. Va.).

  • April 10, 2018

    Panel Majority Says Insurers Breached Contract, Acted In Bad Faith By Failing To Settle

    CHICAGO — The majority of the Fifth District Illinois Appellate Court on April 5 affirmed a trial court’s ruling that insurers breached their contract and acted in bad faith by refusing to settle underlying environmental contamination claims filed against an insured after determining that the insurers used the threat of denying coverage in an attempt to dissuade the insured from settling the claims (Rogers Cartage Co. et al., v. The Travelers Indemnity Co., No. 5-16-0098, Ill. App., 5th Dist., 2018 Ill. App. LEXIS 206).

  • April 9, 2018

    Excess Insurers’ Motion For Reconsideration In Asbestos Dispute Denied

    MILWAUKEE — A Wisconsin federal judge on April 4 denied a motion to reconsider by four excess insurers involved in an asbestos coverage dispute and reiterated that abstention is not warranted (Eaton Corp. v. Westport Insurance Co., et al., No. 15-1157, E.D. Wis., 2018 U.S. Dist. LEXIS 57406).

  • April 6, 2018

    No Coverage For Asbestos Settlement; Self-Insured Retention Not Met, Panel Says

    SAN FRANCISCO — The Ninth Circuit U.S. Court of Appeals on April 4 affirmed a district court’s ruling that an insured is not entitled to reimbursement for defense expenses and settlement costs arising out of an underlying asbestos exposure claim because the settlement did not exceed the policies’ self-insured retention (City of Phoenix v. First Place Insurance Company, et al., No. 16-16767, 9th Cir., 2018 U.S. App. LEXIS 8554).

  • April 5, 2018

    Asbestos Coverage Dispute Transferred From New Jersey To New York Federal Court

    NEWARK, N.J. — A New Jersey federal judge on April 3 granted an insurer’s motion to transfer an insured’s suit seeking coverage for asbestos bodily injury claims to New York federal court after determining that New York has a greater connection to the coverage dispute (Cosmopolitan Shipping Co. Inc. v. Continental Insurance Co., No. 17-4933, D. N.J., 2018 U.S. Dist. LEXIS 57566).