In the following guest post, Chris Quirk, a wholesale broker at ARC Excess & Surplus, now part of CRC Group, examines issues surrounding the provision of notice of circumstances that may give rise to a claim in connection with a claims made and reported insurance policy. Our thanks to Chris for allowing us to publish his article as a guest post on this site. Here is Chris’s article.Continue Reading Guest Post: Dealing with Potential Claims Under Claims-Made and Reported Policies
As readers know, issues surrounding the timeliness of notice of claim are among the most frequently litigated insurance coverage issues. Notice of claims delays occur for many reasons; sometimes, for example, the policyholder does not recognize a particular matter as constituting a claim within the meaning of the policy; sometimes there are process or communications issues that interfere with notice timeliness.
In a recent case and that touches on many of these issues, the Second Circuit, applying New York law, held that an earlier demand letter met the policy’s claim definition, and that the question of whether the provision of notice of claim on Monday morning just after the Saturday expiration of the policy was untimely must be remanded for further consideration by the district court. This case is a cautionary tale in many ways and provides an appropriate occasion to review of some of the first principles of claim notice. The Second Circuit’s August 13, 2024, Summary Order can be found here. (Hat Tip to Geoff Fehling of the Hunton Andrews Kurth law firm for his August 15, 2024 LinkedIn post about the decision, here).Continue Reading Thinking About Notice of Claim Timeliness
In a June 29, 2023, decision in Students for Fair Admissions v. Harvard, the U.S. Supreme Court held that the college’s use of affirmative action in its admissions program was unconstitutional. The discrimination case against the college not only went all the way to the Supreme Court but was also the subject of a long-running insurance coverage dispute involving the college’s excess employment practices insurance. In an August 9, 2023, ruling, the First Circuit held in the insurance coverage dispute that the college’s late provision of notice of claim regarding the underlying discrimination lawsuit precluded excess coverage for the claim. This high-profile insurance coverage ruling has some important lessons about the provision of notice to insurers in connection with liability claims. A copy of the appellate court’s August 9, 2023, ruling can be found here.Continue Reading Late Notice Precludes Excess Coverage for High-Profile Harvard Suit
One of the recurring D&O insurance issues is whether an insurer seeking to deny coverage for a claim based on the insured’s late provision of notice must show that the late notice prejudiced the insurer. In the following guest post, Peter Selvin, the chair of the Insurance Coverage and Recovery Department at Ervin Cohen & Jessup LLP, takes a look at a recent federal district court ruling that supports policyholder’s arguments that the notice-prejudice rule applies under certain circumstances. A version of this article previously was published in the LA Daily Journal. I would like to thank Peter for allowing me publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Peter’s article.
Continue Reading Guest Post: New Decision on Late Notice
It is not uncommon for coverage disputes to arise in connection with D&O insurance claims, but every now and then there is a coverage dispute so broad that it constitutes a veritable D&O insurance coverage curriculum. That was certainly the case in what a Delaware Superior Court judge called the “sprawling insurance coverage dispute” between a unit of Northrup Grumman and its predecessors-in-interest’s D&O insurers. The coverage dispute arose out of underlying claims relating to the 2015 merger of Alliant Techsystems, Inc and Orbital Sciences Corporation to form Orbital ATK, Inc. The court’s lengthy opinion on the parties’ cross-motions for summary judgment and for judgment on the pleadings covers a wide variety of recurring D&O insurance coverage issues and makes for interesting reading for anyone involved with D&O insurance. The Delaware Superior Court’s February 2, 2021 opinion in the Northrup Grumman case can be found here.
Continue Reading Delaware Court Addresses “Sprawling” Northrup Grumman D&O Insurance Coverage Dispute
In a recent decision in an insurance coverage dispute, a federal court applying Puerto Rico law concluded that there was no coverage under a management liability insurance policy for a discrimination claim that had first been made prior to the policy period of the claims made policy at issue, and that notice of the claim was untimely as well. The court’s conclusion is in a sense unremarkable. What is worth considering about the ruling is how often these same problems recur, as discussed below. The District of Puerto Rico’s May 28, 2020 opinion can be found here. A June 17, 2020 post on the Wiley law firm’s Executive Summary Blog about the decision can be found here.
Continue Reading No Coverage for Claim First Made Prior to the Policy Period of a Claims Made Policy
As regular readers know, I have written frequently in the past about late notice issues. In the following guest post, Gregg Glick, Senior Vice President, Private Company/Not-For-Profit Practice Lead at Allied World, and Erin M. Ringbloom, Esq. Vice President, North American Claims Group at Allied World, provide an insurer perspective, both from an underwriter and claims advisor point of view, on the issue of late notice. I would like to thank Gregg and Erin for allowing me to publish their article on my site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Gregg and Erin’s article.
Continue Reading Guest Post: Late Notice: Misinformation, Mistake or Missed Opportunity?
Regular readers know that among the recurring themes on this site are concerns about problems with the application of notice rules to preclude insurance for claims that would otherwise be covered under the policy. These problems are, in my view, particularly abrupt where a claims is made during one policy period and the notice is provided during the policy period of a subsequent renewal policy issued by the same insurer. I have argued that continuity of coverage between the two policies and with the same insurer ought to be taken into consideration and that coverage should be denied only if the insurer can show that the late notice of claim during the renewal period prejudiced the insurer’s interests. In a recent appeal, the Ninth Circuit rejected this continuity of coverage argument. The appellate court’s opinion, though brief, raises a number of interesting points, as discussed below.
Continue Reading Ninth Circuit Rejects Continuity of Coverage as Response to Late Notice of Claim
Under claims made insurance policies, policyholders must provide timely notice of claim to their insurers in order to trigger coverage. Late notice is among the most common reasons that insurers deny coverage for claims. In order to try to avoid a coverage denial for late notice, policyholders have tried to argue that late notice should not preclude coverage where the policyholder renewed the coverage and where successive policies with the same insurer are in place. In a recent decision, an Ohio appellate court, applying Ohio law, rejected a policyholder’s attempt to rely on this kind of continuity of coverage argument. The court’s decision raises some interesting issues, as discussed below.
Continue Reading Ohio Court Rejects Continuity of Coverage as Counter to Late Notice
Readers know that it doesn’t take much to get me up on my hobby horse about insurers trying to deny coverage based on the late provision of notice. In general, I am against a mere procedural fault causing a complete coverage forfeiture. Every now and then though there is a case where the policyholder’s lack of diligence makes the case against the insurer’s coverage defense very tough. A recent decision out of the District of Minnesota provides an example where the extent and nature of the policyholder’s delay in providing notice of claim made the argument in favor of coverage very difficult. But while the insurer’s denial of coverage based on policyholder’s late provision of notice arguably was justifiable in the case, the circumstances involved still present some important lessons both about notice of claim and about the policyholder’s obligations under the policy.
Continue Reading Late Notice of Claim Precludes Coverage