SDV Insights

In April, the Court of Appeals of Texas held that a party seeking additional insured coverage under an umbrella general liability policy issued by Lexington Insurance Company cannot reap the benefits of being an additional insured, and simultaneously avoid the limitations of an arbitration clause contained in the policy.

The Massachusetts Supreme Court has held that an insurer's duty to defend does not include a duty to prosecute or fund its insured's affirmative counterclaim against a third party under an employment practices liability insurance policy. The insured manufacturer in this case was sued for wrongful termination by a former employee whom the manufacturer accused of misappropriating company funds, and intended to pursue a counterclaim to recover the money.

An insurer of a pharmaceutical company is appealing a New Jersey District Court's dismissal of its subrogation claim against a freight carrier that was transporting a $9 million pharmaceutical shipment when it was stolen.

The Rhode Island Supreme Court recently relied on an SDV amicus brief to decide a case favorable to policyholders. In Amberleigh Hudson v. GEICO Insurance Agency, 2017 WL 2622777 (R.I. June 16, 2017), the Court held that an automobile passenger was still "occupying" the vehicle for purposes of uninsured motorist coverage after exiting the vehicle to help an accident victim.

In Erie Insurance Property and Casualty Company v. Chaber, the West Virginia Supreme Court recently held that an insurance policy's earth movement exclusion was unambiguous and applied to both manmade and natural earth movement. The Court also found that a narrow "ensuing loss" exception to the exclusion that provided coverage for glass breakage resulting from earth movement could not be extended to cover the entire loss.

In The Burlington Insurance Company v. NYC Transit Authority, et al., No. 2016-00096, the New York Court of Appeals issued a landmark decision with regard to the meaning of "caused, in whole or in part, by" in the additional insured context.

The Federal District Court for the District of Oregon recently decided that Carbon Monoxide constitutes a pollutant within the meaning of a pollution exclusion in a Commercial General Liability ("CGL") policy.

The bill amends Cal. Civ. Code § 2782.8 as it applies to indemnity agreements with design professionals. The pre-existing § 2782.8 prohibited public agencies from requiring indemnity from design professionals for anything other than claims arising out of, pertaining to, or relating to the negligence, recklessness, or willful misconduct of the design professional.

The American Institute of Architects ("AIA") released the latest revisions to its form construction contract documents at the AIA's National Conference on April 27-29, 2017.

On May 16, 2017, the New York Appellate Division, First Department issued HDI-Gerling Am. Ins. Co., et al., v. Zurich Am. Ins. Co., and Skanska USA Civil Northeast, No. 3095- 3095A, 2017 WL 1013645 (N.Y. App. Div. Mar. 16, 2017). This case involved a priority of coverage dispute between two contractors, Skanska USA Civil Northeast ("Skanska") and Siemens Corp. ("Siemens"), and their respective insurance carriers.