SDV Insights

In this morning’s insurance edition of Law360.com, SDV partner Gregory Podolak was interviewed on a case (First Mercury Insurance Co. v. Shawmut Woodworking and Supply) that we had previously blogged about…

 According to Greg Podolak, managing partner of Saxe Doernberger & Vita PC’s southeast office, similar issues have come up frequently in the context of construction projects over the past several years, and the additional-insured endorsement involved in the case is among the most common in the industry.

“It has presented challenges, as carriers have been inclined to be more aggressive with their position when it comes to the need for contractual privity,” Podolak said. “Many have escaped coverage by making the exact argument that the insurers made in this case.”

By rejecting the notion that a direct contractual relationship is necessary for a contractor to obtain additional-insured coverage under a subcontractor’s policy, the Second Circuit panel has provided more certainty for companies working together on construction projects, attorneys say.

“Contractors doing work in states with adverse case law will be more strict about the additional insured endorsements they will accept and won’t let certain companies on a project if they don’t have those endorsements,” Podolak said. “That is detrimental to the efficiency of the process.” 

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