Allocation
California Court of Appeal Holds Non-Settling Primary Insurer Has Burden to Show No Potential For Coverage in Contribution Action PDF Print
Allocation
Written by CBM   
Thursday, 12 April 2012 00:00

In Axis Surplus Lines Insurance Company v. Glencoe Insurance LTD., No. D058963 (Cal. Ct. App., April 11, 2012) (Fourth Appellate District), the California Court of Appeal held that in a contribution action between two primary insurers, an insured’s satisfaction of its self-insured retention (“SIR”) through a settlement payment shifts the burden to the non-settling insurer to prove an absence of actual coverage. 

The court further held that the “potential for coverage” standard is triggered when the nonparticipating insurer receives notice of the claim, not upon actual satisfaction of the SIR.  Lastly, the court held when the two primary insurers issue policies that contain similar “other insurance” provisions, each requiring “equal share” allocation, equity may nonetheless require the insurer with more time on the risk to assume a greater portion of the liability.

Attachments:
 Axis Decision[ ]69 Kb
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California Court of Appeal Denies Insurer's Contribution and Subrogation Claims Against Another Insurer In a Case Involving Damages Spanning Several Years PDF Print
Allocation
Written by CBM   
Friday, 06 January 2012 00:00

In American States Ins. Co. v. National Fire Ins. Co. of Hartford, No. D057673 (Jan. 6, 2012), the California Court of Appeal determined that American States Ins. Co. could not seek reimbursement from National Fire Ins. Co. of Hartford for a claim assigned to it by its insured because: (1) its claim for equitable contribution was time barred by the two year statute of limitation, and (2) it could not allege the elements required for a subrogation claim where the insured obtained a full recovery.

Attachments:
 American States Ins. Co Opinion[ ]78 Kb
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California Court of Appeal Rules on Application of Horizontal Exhaustion Rule PDF Print
Allocation
Written by CBM   
Friday, 03 June 2011 00:00

In Kaiser Cement and Gypsum Corp. v. Insurance Company of the State of Pennsylvania, No. B222310 (June 3, 2011), the California Court of Appeal (Second District) held that an excess liability policy must respond only after all primary insurance collectible by the insured has responded.  And, where a primary insurer has issued successive policies to an insured, its liability for each occurrence may be limited to a single occurrence limit if the policies so provide.  The court reversed the grant of summary adjudication for the insured as there has not yet been a determination as to exhaustion of the other primary insurers’ policies. 

Attachments:
 Kaiser Cement[ ]1586 Kb
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California Court of Appeal Finds Insurer Could Not Sue Policyholder's Agent for Equitable Subrogation PDF Print
Allocation
Written by CBM   
Friday, 14 January 2011 15:16

In Dobbas v. Vitas, No. C061494, 2011 WL 49581 (Cal. App. Jan. 7, 2011), the Third District Court of Appeal ruled that an insurer cannot sue its policyholder’s agent for “equitable subrogation” for failing to secure appropriate other insurance.  While in some cases the insurer may have a claim for equitable contribution, in this case the court found the insurer did not as it did not pay more than its fair share under pro-rata-by-limits allocation.

Attachments:
 Dobbas v. Vitas[ ]671 Kb
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Federal District Court Holds Insurer In Excess of an SIR Must Contribute to Settlement with Primary Insurers and Affirms Allocation Based on "Equal Shares" PDF Print
Allocation
Written by CBM   
Thursday, 23 December 2010 16:22

In Mt. McKinley Insurance Company v. Swiss Reinsurance America Corporation, No. C 09-03857CW (ND Cal. Dec. 1, 2010), a Federal District Court found that the Swiss Re “excess” policies must contribute with other primary insurers because (1) polices stated they were “primary insurance, except when stated to apply in excess of… other insurance,” (2) the policies did not list any other insurance, and (3) an SIR did not constitute primary insurance.  The court also enforced the insurers’ agreement to an allocation based on “equal shares”’ instead of applying time on the risk.  The SIR was factored into the allocation by deducting the SIR before applying equal shares.

Attachments:
 Mt. McKinley v. Swiss Re[ ]723 Kb
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