Policyholder Pulse
In a previous blog post, we addressed blanket additional insured endorsements, and the circumstances under which Company A could become an additional insured under Company B’s policy, even where Company B failed to add Company A to the policy. In that same vein, a New York trial court granted additional insured status to entities that did not even contract with the named insured, but were referenced in the named insured’s subcontract. Owners and General Contractors should take note of this decision, as it creates the potential for insured status even where there is a lack of contractual privity.
California law has long held that an insurer may not use declaratory relief or other tactics to prejudice the defense of its policyholder in an underlying lawsuit. But in their zeal to avoid coverage, and despite California Supreme Court precedent, insurers sometimes employ tactics that actually increase their policyholder’s risk of liability in the underlying action, contrary to the very purpose of liability insurance. That was the case in the coverage action between football helmet manufacturer Riddell and its liability insurers, which is pending in California state court, where certain London Market Insurers tried to require the production of extensive discovery before that substantially identical production took place in the underlying product liability action.
range of individuals, unless they file a written opt-out. These changes to the California Labor Code are creating confusion for some businesses regarding which employees must now be included on workers’ comp insurance coverage. The consequences of noncompliance can be severe, and businesses would be well-advised to ensure that they have secured the necessary additional coverage or obtained the necessary opt-outs from affected officers, directors, and working partners.
a covered “occurrence” because the damage was purportedly not unintended or unexpected. In recent years, however, courts have shifted course; the majority of courts have found that property damage arising out of faulty workmanship constitutes an “occurrence” under standard-form CGL policies. Additionally, some states enacted legislation requiring CGL policies to define occurrence to include property damage or bodily injury resulting from faulty workmanship, or have made it easier for insureds to obtain coverage for damages as a result of work the insureds performed.