The Fifth Circuit in Evanston Insurance Co. v. Mid-Continent Casualty Co. recently held that multiple collisions caused by the same insured driver over a span of 10 minutes constitute a single occurrence subject to a $1 million limit in the insured’s primary policy with Mid-Continent. The holding reversed a lower court’s ruling that Mid-Continent is liable for an additional sum the excess insurer, Evanston, paid to resolve all of the claims arising from the collisions. At issue, a fundamental question about causation and coverage under commercial liability insurance.
The Delaware Supreme Court ruled on Monday in a long-running dispute involving Viking Pump’s and Warren Pumps’ claims for recovery under primary, umbrella, and excess insurance. The Delaware high court had certified two questions to the New York Court of Appeals. The Delaware decision follows the New York high court’s ruling in May that the policies required “all sums” allocation and “vertical” exhaustion” (click here and here for prior posts).
As a follow-up to my post yesterday concerning the New York Court of Appeals’ decision in In the Matter of Viking Pump, Inc. and Warren Pumps, LLC, Insurance Appeals, where the New York high court confirmed that policyholders may allocate all amounts of loss to a single policy and a single policy year, Syed Ahmad, a partner in our Insurance Coverage Counseling and Litigation team, was interviewed by Law360 about the decision’s broad-ranging implications. As Mr. Ahmad explained in an article appearing today in Law360, titled NY Allocation Ruling Speeds Policyholders’ Road To Recovery, “[u]nder all-sums, policyholders can seek to recover all amounts owed from one insurer, which will make things much easier for them to recover for a particular loss.” This, plus the decision’s directive that all insurers in a given policy year must pay without the need for horizontal exhaustion of coverage in subsequent policy years, paves the way for policyholders to obtain full indemnification from a single “tower” of coverage.
On Tuesday, May 3, 2016, the New York Court of Appeals held that each of several excess liability insurers can be wholly responsible for the entire extent of their policyholders’ asbestos liabilities. The Court further held that “vertical” exhaustion would apply; rejecting the insurers’ attempt to apply “horizontal” exhaustion before upper-layer policies must respond. The decision, in In the Matter of Viking Pump, Inc. and Warren Pumps, LLC, Insurance Appeals, comes in response to two questions certified from the Delaware Supreme Court: