Coverage


The Burden of Allocation

June 17th, 2018 By Jeffrey C. Glass

Insured cannot arbitrarily allocate settlement proceeds to non-covered damages in order to preserve coverage claims against a non-contributing insurer. Judge Lee Rosenthal, of Texas’ U.S. Southern District, recently prohibited an insured from unilaterally allocating general settlement amounts from its subcontractors to uncovered damages, in order to preserve claims against insurers “that would cover the damages if the loss was properly allocated to that policy.”  In  Am. Guarantee & Liab. Ins. Co. v. United States Fire Ins. Co., 255 F. Supp.
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Insurance Coverage for Punitive Damages – The Discussion Continues

May 15th, 2018 By Tara Mireur

The Court of Appeals of Texas, Fourth District, sitting en banc, has denied a motion for en banc reconsideration.  The case, Farmers Texas County Mutual Insurance Company v. Zuniga, 2018 WL 1310157, involved the question of whether or not a form automobile insurance policy covered exemplary damages.  In November 2017, the San Antonio Court of Appeals held that the policy, under which the insurer agreed to “pay damages for bodily injury,” did not provide coverage for a claim for punitive
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Defining Damages in a CGL Policy – Do Attorney’s Fees Make the Cut?

March 13th, 2018 By Sarah Scott

Given the broad nature of most commercial general liability (CGL) policies, it’s not surprising that creative attorneys continue to press new arguments about costs and fees that should (or should not) be covered. In most CGL policies, the insuring agreement says the carrier will pay “those sums that the insured becomes legally obligated to pay as damages because of ‘bodily injury’ or ‘property damage’ to which this insurance applies…” Problematically, many policies don’t define the term “damages,” which leaves wiggle
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Judge Pushes the Button for Coverage for Elevator Subcontractor

February 27th, 2018 By Jeffrey C. Glass

Literal interpretation of unambiguous policy language rejected  because it would defeat the purpose of the liability coverage. In a recent decision construing a commercial general liability policy, Judge Sam Sparks of the Western District of Texas used contextual clues in the policy as well as an “illusory coverage argument” to narrow an exclusion whose literal words applied more broadly. In Northfield Ins. Co. v. Herrera, A-16-CA-00553-SS, 2017 WL 5147618, at *3 (W.D. Tex. Nov. 6, 2017), an employee of Austin Energy
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Anti-Concurrent Causation Clause Renders “Status” Analysis in Surface Water Exclusion Largely Immaterial

September 6th, 2017 By Jeffrey C. Glass

Unfortunately for many homeowners recovering from Hurricane Harvey-related flooding, most Texas homeowners’ policies will not provide coverage for their claims. Damage caused by floods and surface water is excluded regardless of any other contributing cause of the loss. This was not always the case. In State Farm Lloyds v. Marchetti, 962 S.W.2d 58, 61 (Tex. App.–Houston [1st Dist.] 1997, pet. denied), the Court ruled that a surface water or flood exclusion did not apply to damage to a house resulting
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BBQ Season Brings Coverage Conundrum

July 26th, 2017 By Catherine Hanna

It’s camping and barbecue season, and that usually involves more propane gas usage.  Injuries resulting from the emission of propane gas may not be covered under certain insurance policies.  Commercial general liability, homeowner, and auto insurance policies often have a pollution exclusion which excludes coverage for damage to property or injuries resulting from certain pollutants. Propane is classified as an asphyxiant gas and exposure to levels above 2,100 ppm is considered immediately dangerous to life or health. See The National
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