SDV Insights

Contract exclusions are common fixtures in directors and officers liability policies; however, they can be broadly interpreted to eliminate valuable coverage. The purpose of this Practice Note is to assist policyholders in identifying whether their policies contain a contract exclusion and providing them practical recommendations to assist in negotiating more favorable language in their policies.

In a significant victory for policyholders, the Northern District of Illinois has found a duty to defend under a commercial general liability ("CGL") policy for damages related to COVID-19. In reaching this decision, the court made several significant findings regarding the scope and interpretation of "damages," "because of," and "bodily injury" in the context of general liability coverage.

After suffering historically destructive fires in 2018, California endured five of the six largest fires in state history in 2020. Nearly 10,000 fires burned over 4.2 million acres--making 2020 the most significant California wildfire season on record

Under current New York law, contractors and design professionals have exposure to bodily injury and property damage claims resulting from construction defects for a potentially unlimited number of years after completion of a project. New York is considering legislation, which, if enacted, would create a statute of repose limiting the number of years after completion of construction that legal action may be asserted against a contractor.

Emerald Holding Inc. ("Emerald"), a leading operator of business-to-business trade show events across the United States, has suffered millions of dollars in losses from canceled or postponed in-person events in order to comply with health and safety government mandates due to the Coronavirus pandemic.

State Farm's additional insured endorsements all contain unique limiting language that likely operates as a labor law exclusion. On the excess layer, State Farm cannot provide primary and non-contributory endorsements or a waiver of subrogation. As a result, State Farm insured subcontractors are probably in breach of their contractual insurance requirements.

The risk of bodily injury lawsuits is an unavoidable reality for property owners and facilities managers ("FMs") of large commercial sites such as universities, malls, office buildings, or stadiums. Any person who steps foot on the property is a potential plaintiff, including students, tenants, customers, contractors, and vendors.

In the year following the global outbreak of COVID-19, thousands of businesses have experienced unprecedented financial hardship. It is no surprise that surviving businesses are looking to their insurance policies to recover lost business income incurred as a result of the pandemic.

New York law has historically allowed insurers to recoup defense costs paid on behalf of an insured if there is ultimately no coverage for the underlying action, provided that the insurer reserved its rights to seek reimbursement.

In New Jersey Transit Corp. v. Certain Underwriters at Lloyd's London, New Jersey's highest court upheld an appellate decision finding that New Jersey Transit Corporation ("NJT") was entitled to full coverage under its property insurance policy for damages caused by Superstorm Sandy.