On May 2, 2025, the Tenth Circuit Court of Appeals issued an opinion in AdHealth Limited v. PorterCare Adventist Health Systems affirming the lower court’s summary judgment ruling that a hospital’s excess liability insurance policies’ definition of “medical incident” unambiguously applies to the injuries of a single person, not the treatment of multiple people exposed to the same conditions. As a result, each claim for a “medical incident” must individually exceed the ... Keep Reading »
Excess
New Jersey Court Holds Primary Home Insurer Must Cover Dog Bite Injury at Insured’s Second Home
In Berardi v. FMI Insurance Co., a panel of New Jersey’s Superior Court, Appellate Decision, affirmed a lower court’s ruling, which ordered a primary home insurer to defend its insured in a dog bite lawsuit, stemming from alleged injuries sustained by a house cleaner at the insured’s secondary home. Background and Underlying Action The plaintiffs, Anthony and Janet Berardi, own a primary residence in Sparta, New York, along with a second home in Montauk, New York. ... Keep Reading »
Second Circuit Gives Lesson in Interplay Between Construction Contracts and CGL/Umbrella Policies
On construction projects, it is common for the owners, general contractors, and subcontractors to execute various contracts requiring the parties to procure insurance and have other parties designated as additional insureds under those policies. Recently, the Second Circuit Court of Appeals in Amerisure Insurance Co. v. Selective Insurance Group Inc. addressed the interplay between construction contracts and commercial general liability and umbrella policies. The case ... Keep Reading »
Fifth Circuit Affirms Finding of No Coverage for Phished Funds Never “Held” by Insured
As we previously reported, in February 2021, a Texas federal court ruled that RealPage Inc. was not entitled to insurance coverage for funds diverted in an email phishing scheme because RealPage did not "hold" the diverted funds. The Fifth Circuit Court of Appeals has now weighed in, agreeing that RealPage never "held" the diverted funds as required by the policy and affirming the district court's decision. In 2018, a RealPage employee clicked on a phishing email ... Keep Reading »
Ninth Circuit Adopts General Rule Regarding Circumstances in Which Excess Insurers May Dispute Exhaustion of Underlying Insurance
Addressing an issue of first impression, the Ninth Circuit recently adopted a general rule that will sharply limit the ability of excess insurers to second-guess payment decisions made by lower-level insurers. Subject to limited exceptions, the court concluded that an excess carrier generally cannot challenge decisions underlying insurers made with respect to earlier, unrelated claims, as a basis for arguing that its own layer of coverage has not yet been reached. AXIS ... Keep Reading »
Pennsylvania Federal Court Refuses to Dismiss Bad Faith Claim, Even Though Insurer Timely Made Demanded Payments
There have been more developments in Ironshore Specialty Insurance Co. v. Conemaugh Health System Inc., the case brought by Ironshore, as excess carrier, to seek reimbursement of amounts paid in an underlying medical malpractice settlement. While we previously reported that the court denied Conemaugh's (the insured's) motion to dismiss, the court has now also ruled that Conemaugh's counterclaims for bad faith can move forward, despite the fact that Conemaugh did not ... Keep Reading »
Eleventh Circuit Rejects Insurer-Defended Policyholder’s Bid to Expand Florida’s Bad Faith “Excess Judgment Rule” to Include Collusive Settlements Concocted Without Insurer’s Consent
In Cawthorn v. Auto-Owners Insurance Co., No. 18-12067 (11th Cir. Oct. 25, 2019), the Eleventh Circuit affirmed the U.S. District Court for the Middle District of Florida’s grant of summary judgment in favor of Auto-Owners Insurance Co., ruling that a consent judgment does not constitute an excess verdict, which is an essential element of a Florida bad faith claim. This appeal arose from an April 2014 underlying automobile accident in which David Cawthorn and Bradley ... Keep Reading »
New York State Court Affirms All-Sums Allocation Method
A New York state court explored the proper allocation method for insurance policies with non-cumulation clauses covering asbestos exposure loss occurring over the course of multiple successive policy periods in In re Liquidation of Midland Insurance Co. At issue were four excess policies issued by Midland to ASARCO LLC, which, through one of its subsidiaries, engaged in the selling of asbestos products. A series of asbestos claims against ASACRO ensued, and ASARCO sought ... Keep Reading »
Beware Of The Warranty – Second Circuit Relies On Terms Of Warranty, Not Policy, To Make Coverage Determination
Can the terms of a warranty impact the scope of coverage provided by an insurance policy even if the policy does not explicitly incorporate the terms of the warranty? The answer to this question appears to be yes, at least under New York law, according to the recent decision by the U.S. Court of Appeals for the Second Circuit in Patriarch Partners, LLC v. Axis Ins. Co., No. 17-3022, 2018 WL 6431024 (2d Cir. Dec. 6, 2018). Insured Issues Warranty To Insurer Related To ... Keep Reading »
An Absolute Pollution Exclusion: Reading the ‘Fine’ Print
A federal judge recently relied on a pollution exclusion to find that Great American Insurance Company was not obligated to cover losses associated with the unintended distribution of rock fines into New Jersey’s Spruce Run reservoir. In Great American Ins. Co. v. ACE American Ins. Co., No. 4:18-CV-114-A (N.D. Tex. Jul. 10, 2018), the Northern District of Texas examined the scope of an absolute pollution exclusion and found that it applied to bar coverage, despite the ... Keep Reading »