Articles Posted in Insurance

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Recently, our colleagues Tamara Bruno, Colin Kemp, Peter Gillon, Vince Morgan and Joseph Jean published an alert titled Hurricane Matthew Requires Immediate Action to Maximize Insurance Recovery to help you weather any storm.20161009-DOD-AP-0009

Photo:  U.S. Department of Agriculture – A MH-60 helicopter from the U.S. Coast Guard  (USCG) Aviation Training Center Mobile, AL conducted a fly over of the Charleston, South Carolina area that was affected by Hurricane Matthew, on Friday, October 8, 2016. The Coast Guard is committed to the safety of the community, environment, and responders. USCG photo by Petty Officer 3rd Class Alexandria Preston – Creative Commons

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Check out my latest blog for Pillsbury’s Policyholder Pulse titled A Subcontractor’s Defective Work Is an Occurrence: Weedo Wobbles … and Falls Down. It discusses a recent ruling in New Jersey,  Cypress Point Condominium Assoc., Inc. v. Adria Towers, L.L.C., on the issue of whether damage caused by a subcontractor’s faulty workmanship constitutes “property damage” and an “occurrence” under a property developer’s commercial general liability insurance policy.

Additional Source: Weedo v. Stone-E-Brick, Inc.

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Pillsbury’s Policyholder Pulse Law blog recently posted an interesting blog,flood2 Use Contractor’s Pollution Liability Insurance to Clean Up Potential Gaps in Your CGL Coverage by , on the importance of contractors having the right liability coverage in place in the event that a flash flood or other natural disaster causes damage that is classified by the insurer as a pollution event.

Photo:  Erich Ferdinand, Deluge, Taken Nov. 29, 2012 – Creative Commons

 

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According to the Ninth Circuit Court of Appeals, in Ash Grove Cement Co. v. Liberty Mutual Ins. Co., an unpublished opinion applying Oregon law, an insurer’s duty to defend begins with a “104(e) letter” from the EPA and continues for the duration of the regulatory process. In A “Suit” by Any Other Name: Ninth Circuit Rules CERCLA 104(e) Letter Triggers Duty to Defend, Pillsbury attorney discusses the Ash Grove ruling.

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In New York High Court Gives the Bronx Cheer to Insurers’ Pro Rata Allocation and Exhaustion Arguments, Pillsbury attorney  discusses New York State Court of Appeals’ decision in In re Viking Pump, Inc. The Court of Appeals accepted two certified questions from the Delaware Supreme Court. As noted by Ben, “in a New York minute,” the Court of Appeals has “leveled the playing field by endorsing the ‘all sums’ and ‘vertical exhaustion’ approach to allocation advocated by a policyholder, at least as to policies containing ‘non-cumulation’ and ‘prior insurance’ provisions.” This ruling will be of interest to those who have encountered in New York barriers to insurance coverage where multiple policies over multiple policy terms are implicated, including, but not limited to, coverage for environmental or asbestos liabilities.

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UPDATE: When Attorneys General Attack II

In When Attorneys General Attack, Pillsbury attorneys Sheila McCafferty Harvey, Joseph Jean, Carolina Fornos and Benjamin Tievsky discuss the New York State Office of the Attorney General’s and other jurisdictions’ power to aggressively scrutinize energy companies’ public statements on the subject of climate change. In the alert, they provide strategies for managing and obtaining insurance coverage for these investigations.

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In A Double Standard in Construction Defect Coverage Cases?, I discuss the recent decision of Allied Property & Casualty Insurance Co. v. Metro North Condominium Associates.  This decision highlights why only a minority of courts still hold to the fiction that construction defects cannot give rise to an “occurrence” covered under a commercial general liability (CGL) policy, why construction companies and others need to understand how this rule is applied, and why contractors may want to avoid choosing Illinois law to control their CGL policy.

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ClockIn his November op-ed, C. Andrew Gibson states that bonds do not have a deductible as compared to a subcontractor default insurance (SDI) policy that does carry a deductible. The statement is literally correct. A bond does not have a “written” deductible when a default takes place. However, frustration develops when the question is asked “When will a bond pay?” We will explore the time it takes for each to respond and pose the question at the time of default, would you rather have contract certainty (SDI) or uncertainty (Bond)? Is uncertainty a deductible disguised as loss of time?

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In Fabozzi v. Lexington Insurance Company, the United States Court of Appeals for the Second Circuit has reaffirmed that ambiguities in an insurance policy must be construed against the insurer.

The Fabozzis were renovating their home when they learned that its interior walls were so rotted that the entire house was actually in the process of collapsing. Faced with the complete loss of their home, the Fabozzis understandably turned to their homeowners’ insurer, Lexington Insurance. The homeowners’ policy provided coverage for collapse caused by certain named perils, including hidden decay. But the policy also required that the collapse be “caused only by one or more of” the named perils. That simple, 7-word phrase led to Lexington’s denial of coverage and a decade of litigation.

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Subcontractor default insurance (SDI) was created more than twenty years ago. Despite its relatively recent vintage, SDI is now offered by multiple insurers and is quickly replacing traditional subcontractor payment and performance bonds as a go-to option on large-scale construction projects. SDI has many benefits that surety bonds don’t. We’ll be going into this in substantial detail at our Fourth Annual Subcontractor Default Insurance Forum that Pillsbury co-presents, along with our friends at Willis Towers Watson, in Scottsdale in May.

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