In an automobile coverage dispute, after exhaustion of the policy deemed “primary” under Insurance Code section 11580.9(d), all policies covering the negligent driver must exhaust before any policies covering the driver’s vicariously liable employer are implicated. ( GuideOne Mutual Insurance … Read More

Although an insured’s insolvency rendered it unable to pay a self-insured retention, that did not relieve the insurer of a duty to pay the covered portion of a judgment against the insured. ( Phillips v. Noetic Specialty Insurance Company (S.D. … Read More

An “ordinance or law” exclusion in a first-party property policy barred coverage where a city ordered demolition of a partially-remodeled house because of floodplain regulations. ( Reichert v. State Farm General Insurance Company (2013) 212 Cal.App.4th 1543)

Where a general liability policy only covered an additional insured for vicarious liability of the named insured, a claim by the additional insured against the named insured did not fall within a policy exclusion for “inter-insured claims.” ( Gemini Ins. … Read More

An exclusion for water that “backs up or overflows” from a sewer or drain applied even where a downstream blockage prevented the water from ever entering the sewer or drain. ( Cardio Diagnostic Imaging, Inc. v. Farmers Insurance Exchange (2012) … Read More

Even though an insured waited nine months to report a wildfire claim for smoke, soot and ash contamination, the insurer waived the defense by failing to promptly object and by proceeding to investigate the claim. In addition, even though other … Read More

A policy’s “personal and advertising” coverage for “disparagement” was not triggered where the insured’s advertisements only mentioned the insured’s own products and never mentioned the claimant’s products. ( Hartford Cas. Ins. Co. v. Swift Distribution, Inc. (2012) 148 Cal.Rptr.3d 679) … Read More

An insurer was justified in denying coverage for the alleged theft of an automobile where the insured made numerous misrepresentations about the price he paid for the car, pre-existing damage, repair of the damage and when he last saw the … Read More

In an equitable contribution action between liability insurers, once a participating insurer proves a “potential for coverage” under a non-participating insurer’s policy, the burden shifts to the non-participating insurer to prove the “absence of actual coverage” under its policy. ( … Read More

A lawsuit by the federal government against an insured for violation of the Fair Housing Act was not potentially covered under commercial general liability policies insuring against “wrongful eviction, wrongful entry and invasion of right of private occupancy,” but was … Read More

California Insurance Code section 520 does not invalidate a “consent-to-assignment” clause contained within a commercial general liability policy. ( Fluor Corporation v. Superior Court (2012) — Cal.App.4th –, WL 3741979) Facts In 1924, the original Fluor Corporation (“Fluor-1”) was created. … Read More

An insurer on the risk at any time when covered damage occurred was obligated to indemnify the insured for “all sums” the insured owed up to the policy limits, and the insured was entitled to “stack” the limits of all … Read More

For purposes of federal diversity jurisdiction, an independent adjuster was not a “sham” defendant where the insureds alleged that the adjuster negligently supervised and controlled emergency repairs, causing additional damage to the insureds’ property. ( Huber v. Tower Group, Inc. … Read More

A general liability insurer was entitled to reimbursement from an insured of sums the insurer paid in settlement of the insured’s alleged liability in an underlying “slumlord” suit. ( Axis Surplus Insurance Company v. Reinoso (2012) WL 2389324) Facts Edgar … Read More

A general liability policy covering the personal injury offense of “disparagement” required an insurer to defend an insured against a suit alleging that the insured improperly sold the claimant’s products at severely discounted, “close-out” prices, thus diminishing the claimant’s brand … Read More

After an insured’s liability has become reasonably clear, an insurer has a duty to attempt to effectuate settlement on behalf of the insured, even in the absence of a settlement demand from the claimant. ( Du v. Allstate Ins. Co. … Read More

In the absence of actual coverage, a liability insurer cannot be liable to an insured for failing to accept a third-party claimant’s reasonable settlement offer within the policy limits. ( DeWitt v. Monterey Insurance Company (2012) 204 Cal.App.4th 233) Facts … Read More

In an equitable contribution action, an insurer was only required to show a “potential” for coverage under a co-insurer’s insurer’s policy which had a self-insured retention that the insured paid as part of an underlying settlement. ( Axis Surplus Ins. … Read More

An insurer that settled a construction defect case on behalf of an insured was barred by the two-year of limitations from seeking equitable contribution from another insurer that had refused to participate in the settlement. ( American States Ins. Co. … Read More

A commercial excess liability policy did not cover an insured’s alleged liability for an injury which occurred before the policy was issued .(Wallman v. Suddock ( 2011) 200 Cal.App.4th 1288.) Facts In 1994, Barry Wallman and other members of his … Read More