Articles Posted in General Liability

Published on:

NY-Cal-flags-278x300Four months ago, New York Governor Kathy Hochul signed the Adult Survivors Act (ASA) (S.66A/A.648A), creating a one-year window, beginning November 24, 2022, for adult survivors of sexual assault to bring civil claims against their alleged attackers which otherwise would have been time barred. On September 19, 2022, California Governor Gavin Newsom signed an equivalent law, the Sexual Abuse and Cover Up Accountability Act (AB-2777), which similarly suspends the statute of limitations for civil claims of sexual assault and other vicarious offenses arising out of that conduct starting January 1, 2023. These laws will likely generate a surge of litigation in California and New York, undoubtedly impacting many businesses operating there. Many, if not most, of those companies will look to insurers to furnish legal defenses and to financially support settlements or damage awards based on past policies.

Continue Reading ›

Published on:

GettyImages-sb10065463h-001-300x200An oft-repeated maxim in self-help literature is: “Do not let your circumstances define who you are.” In a similar vein, policyholders should proactively manage situations in which known circumstances may potentially give rise to an eventual claim.

Suppose a company perceives the potential risk of litigation or a government investigation. This may not necessarily be the result of any known wrongful conduct—such risk may just be inherent in the company’s business model or within the company’s industry. When the company’s D&O insurance policy (or employment liability or professional liability, as the case may be) is on the verge of expiring, the company may be faced with the decision whether to report such circumstances to the insurer under the policy’s “notice of circumstances” (NOC) provision, which permits the policyholder to provide notice of facts or events that may give rise to claims in the future. If such notice is given within the specified time, the insurer will treat any subsequent claims arising out of the noticed circumstances as claims first made within the policy period, even if the claims are brought much later.

Continue Reading ›

Published on:

GettyImages-1359747893-coal-ash-plant-300x200Early in 2021, we wrote about potential insurance implications that could arise from the then-new Biden Administration’s expected regulatory priorities. Among other things, we noted that heightened scrutiny on coal ash was expected. On January 11, 2022, the U.S. Environmental Protection Agency (EPA) confirmed that prediction, issuing a press release announcing “key steps” it is taking to “protect groundwater from coal ash contamination.” As companies with coal ash liabilities consider EPA’s new guidance and next steps, they should be aware that they may have insurance that could cover some of their coal ash cleanup costs.

Continue Reading ›

Published on:

PFAS-1332327258-300x283In August, we provided an overview of the recent increase in regulatory and private litigation activity around per- and polyfluoroalkyl substances (PFAS), colloquially known as “forever chemicals,” and potential insurance coverage for PFAS liability. There have been important developments on the PFAS front in the past few months. Companies with any connection to PFAS need to be cognizant of the evolving regulatory landscape and be prepared to defend against potential PFAS liability. Fortunately, insurance coverage may be available to help mitigate these fast-growing claims—including coverage under historic general liability policies.

Continue Reading ›

Published on:

One large yellow rubber duck with many smaller ones following itA feature of most corporate liability insurance programs is the tower system of coverage: a primary policy with several overlying excess policies stacked atop one another collectively providing coverage up to a desired (or available) limit of liability. Depending on the size and liability exposures of a policyholder, a tower can consist of dozens of policies providing limits totaling hundreds of millions of dollars. Adding to this complexity, excess policies often share layers of coverage in quota share arrangements, sometimes subscribing to the same policy but more often issuing separate policies for a stated percentage of the quota share whole. To avoid as much as possible an impenetrable web of conflicting coverage terms, excess policies often “follow form” to the underlying coverage (usually to the primary policy) providing the insurer certainty and providing the policyholder a consistent tower of coverage. It is not always possible, though, to obtain clarity and certainty in tower placements. Insurance companies issuing excess coverage may not wish to agree to all the terms included in the underlying policies, and so may offer additional or differing terms, creating inconsistencies in an otherwise monolithic tower. For example, a primary insurer may refuse to cover punitive damages whereas an excess insurer may agree to do so, or vice versa.

Continue Reading ›

Published on:

Red sign hanging at the glass door of a shop saying: "Going out of business".In recent weeks, two insurers with significant legacies of occurrence-based general liability coverage took important steps to liquidate their estates.

Bedivere Insurance Company (OneBeacon) Liquidation

The first insurers are associated with Bedivere Insurance Company, formerly known as OneBeacon Insurance Company (OBIC). OBIC’s history stretches back to the 1800s but is most well known as the successor to the General Accident and Commercial Union families of insurers. These companies wrote many policies from the 1960s through the 2000s and include Commercial Union Assurance Company, Employers Commercial Union Insurance Company, Employers’ Surplus Lines Insurance Company, Employers’ Liability Assurance Corporation Limited, General Accident Insurance Company, and CGU Insurance Company (and many other smaller companies). OBIC stopped writing new business in 2010 and entered run-off, paying claims from its historic exposures. In 2014, OneBeacon Group, OBIC’s parent, sold its run-off business to a Bermuda entity called Armour Group. The transaction included OBIC and other subsidiaries (Potomac Insurance Company, OneBeacon America Insurance Company, and The Employers Fire Insurance Company). OBIC changed its name to Bedivere Insurance Company in 2015, and in October 2020, absorbed its subsidiaries by merger.

Continue Reading ›

Published on:

iStock_86660363_MEDIUM-gavel-money-300x200As coverage counsel, we witness firsthand the precarious positions policyholders are often left in due to the actions (or inactions) of their insurance carriers. A prime example of such a catch-22 scenario is when an insurer refuses to consent to a settlement offer while defending under a reservation of rights.

Continue Reading ›

Published on:

id585177932-construction-300x300Times of crisis can bring out the best in people. Unfortunately, times like this can also be an opportunity for exploitation of inexpensive, and potentially forced, labor. As America reopens its economy, it is likely that we will begin to see a surge in many industries. The resulting demand for labor, coupled with unprecedented unemployment and related desperation not only in America, but worldwide, could lead unscrupulous individuals and companies to exploit American and foreign workers. We saw this with previous disasters, such as Hurricane Katrina, where foreign laborers were exploited in the rebuilding process with false promises of citizenship. Now, to be clear, exploitation occurs even during times of economic prosperity; however, it can be even more pronounced and egregious when people must deal with uncertainties and hardships never before experienced in their lifetimes.

Continue Reading ›

Published on:

iStock-1220357592-wfh-300x200A couple months into the widespread shift to remote work for many employees on a temporary basis, an increasing number of companies are considering or already implementing a permanent shift to remote work for most or all of their employees. Unsurprisingly, this shift is rapidly occurring in the technology industry. For example, Twitter’s CEO announced this week that its employees will be allowed to work from home permanently. But it is also occurring across other industries, including the insurance industry. For example, Nationwide is planning to permanently exit its building space, other than four main campuses, before the end of the year and is moving its other employees to permanent remote-working status.

Continue Reading ›

Published on:

Seal_of_the_Supreme_Court_of_Texas-300x300In the uncertain times ushered in by the COVID-19 pandemic, observers of the insurance law landscape can find footing in an old, familiar story: a single insured left deeply dissatisfied by her insurance provider’s coverage for an accident lawsuit against her. But in In re: Farmers Texas County Mutual Insurance Co., a novel question of settlement authority offers the chance to make new law.

Continue Reading ›