Latest News

8 Jun, 2015

RAILROAD ADDITIONAL INSURED COVERAGE

2018-04-23T20:59:42-05:00June 8th, 2015|Additional insured coverage, Commercial General Liability (CGL), Contract liability coverage, Midwest Insurance Law Guide|

 KEEPS CHUGGING ALONG... Railroads have been asking for additional insured coverage from their vendors, contractors and lessees for some time now.  The body of case law challenging that coverage is slowly building.  In the railroads' favor.  Let's take a look together at the most recent case for some additional nuggets of insight. In Norfolk Southern Ry Co., v. National Union Fire Ins. of Pittsburgh, PA, 999 F. Supp. 2d 906 (U.S. Dist. [...]

24 Feb, 2015

ADDITIONAL INSURED COVERAGE – DENIED!!

2018-04-23T20:59:42-05:00February 24th, 2015|Additional insured coverage, Contract liability coverage, Midwest Insurance Law Guide|

 There is a new case you should know about... In Re Deep Water Horizon ...only because everyone else is talking about it.   Let's break it down here, Dear Readers!  The Texas Supreme Court last week decided In Re Deepwater Horizon , No. 13-0670 (Tex. Sup. Ct. Feb. 13, 2015).  (Hover and click on the link above in order to access the court's decision). The court there rejected additional insured coverage for BP's losses due [...]

5 Nov, 2013

INSURANCE POLICY RISK TRANSFERENCE – 2 WAYS

2018-04-23T20:59:44-05:00November 5th, 2013|Additional insured coverage, Commercial General Liability (CGL), Contract liability coverage, Indemnity clauses, Midwest Insurance Law Guide, Risk transference|

How does a policyholder enforce a contract in which one party assumes the risk of another?    Let's break it down two ways: By additional insured (AI) endorsement.  AI is an insured. Insurer owes AI fiduciary duties. AI must follow policy terms for coverage. AI does not need to have a written contract with Named Insured for coverage to apply. In most states, AI coverage will include negligent acts of AI in addition to [...]

18 Sep, 2013

Contractual Liability Coverage v. Additional Insured Endorsement

2018-04-23T20:59:44-05:00September 18th, 2013|Additional insured coverage, Commercial General Liability (CGL), Contract liability coverage, Midwest Insurance Law Guide|

Contractual liability coverage is excluded in a standard CGL policy. However the policy makes an exception - or gives coverage back - to Named Insureds who assume the tort liability of another party in an "insured contract" to pay for damages that occur after the policy is issued.  (See, Section I, ¶2. Exclusions, B. 2.)   An "insured contract" excludes operations within 50 feet of any railroad operations, but this coverage can be added [...]

3 Aug, 2013

BELT + BRACES = RISK TRANSFERENCE

2018-04-23T20:59:44-05:00August 3rd, 2013|Additional insured coverage, Commercial General Liability (CGL), Contract liability coverage, Midwest Insurance Law Guide, Risk transference|

The best way to protect a client from legal liability and to transfer risk to another company is the belt and braces approach.  A "belt" is a well crafted indemnity clause where one party (indemnitor) promises to hold the other (indemnitee) harmless for any and all losses arising out of, or connected to, the indemnitor's work. An example is when a sub-contractor promises to hold a contractor harmless for loss or damages which occur when [...]

13 Jul, 2013

ADDITIONAL INSUREDS: KNOW YOUR STATE LAWS!

2018-04-23T20:59:44-05:00July 13th, 2013|Additional insured coverage, Contract liability coverage, Midwest Insurance Law Guide, Policyholder, Railroad indemnity|

6 STATES BAR CONTRACTUAL INDEMNITY FOR ADDITIONAL INSUREDS Colorado.  See, Colo. Stat.  § 13-21-111.5  (except for railroads); Georgia.  See, Ga. Code § 13-8-2  (but allows hold harmless clauses in an insuring contract); Montana.  See, Mont. Rev. Code § 28-2-2111; New Mexico.  See, N.M. Stat. § 56-7-1 (prohibits requirements to "insure or defend" but allows OCIP and limited indemnity clauses); Oklahoma.   See, Okla. Stat. § 15-221; Oregon.   See, Or. Rev. Stat.  §30.140  (prohibits subcontractor's [...]

8 May, 2013

ADDITIONAL INSURED ENDORSEMENT: Coverage Is Not Dependent Upon Indemnity Clause in Underlying Contract

2018-04-23T20:59:44-05:00May 8th, 2013|Additional insured coverage, Contract liability coverage, Midwest Insurance Law Guide|

In a recent Nebraska case, Federated Service Ins. Co. v. Alliance Const., LLC, 282 Neb. 638, 646 (2011), the Supreme Court issued a seminal ruling that affects additional insured endorsements written in that state. In Federated, a subcontractor agreed in a written contract to add a general contractor as an additional insured to the sub’s insurance policy.  The parties also had a separate indemnity clause in the contract whereby the sub [...]

14 Mar, 2013

HOW TO GET INDEMNITY IN A CONSTRUCTION CONTRACT

2018-04-23T20:59:45-05:00March 14th, 2013|Additional insured coverage, Commercial General Liability (CGL), Construction liability, Contract liability coverage, Indemnity clauses, Midwest Insurance Law Guide|

Most Midwest states have specific statutes that bar one party from asking for indemnity from another party in a construction related contract.  Iowa, Kansas and Missouri do not.  However, Nebraska, North Dakota, South Dakota and Minnesota do. All parties to any contract that involves any type of construction or design must be aware of these statutes.  If not, your AIA or other contract provisions on indemnity may not be upheld or enforceable in a court of law.  This is [...]

7 Mar, 2013

WHAT RAILROADS SHOULD KNOW ABOUT BEING AN ADDITONAL INSURED BY CONTRACT

2018-04-23T20:59:45-05:00March 7th, 2013|Additional insured coverage, Commercial General Liability (CGL), Contract liability coverage, Indemnity clauses, Midwest Insurance Law Guide, Railroad endorsement, Railroad indemnity|

Railroads can be covered for losses caused in whole or in part by a contractor.  If a railroad is added to the contractor’s Commercial General Liability (CGL) insurance policy as an additional insured, all losses which arise out of the contractor’s work should be covered. The case of Cont’l Cas. Co. v. Auto-Owners Ins. Co., 238 F.3d 941, 944 (8th Cir. 2000) explains this concept of risk transference.  There, Burlington Northern R.R. Co. contracted with [...]

25 Jan, 2013

EXTENDING ADDITIONAL INSURED COVERAGE BY COURT OPINION

2018-04-23T20:59:45-05:00January 25th, 2013|Additional insured coverage, Commercial General Liability (CGL), Complex insurance coverage, Contract liability coverage, Indemnity clauses, Insurance contract, Midwest Insurance Law Guide, Property and casualty|

I often discuss the role of the courts in broadening coverage for additional insureds in a Commercial General Insurance (CGL) policy.  Here is another case where a court has extending coverage – probably well beyond what the underwriter intended at the time the policy was issued.   In the case of Evanston Ins. Co. v. ATOFINA Petrochemicals, Inc., 256 S.W.3d 660, 666 (Tex. 2008), ATOFINA contracted with Triple S Industrial [...]

4 Jan, 2013

WHO IS AN ADDITIONAL INSURED?

2018-04-23T20:59:45-05:00January 4th, 2013|Additional insured coverage, Commercial General Liability (CGL), Contract liability coverage, Indemnity clauses, Midwest Insurance Law Guide|

Adding another company as an Additional Insured under your own Commercial General Liability (CGL) policy is a common practice.  The addition protects that other entity against your company’s negligence.  The coverage is almost always limited to “your” work, meaning the work being performed by the Named Insured, not the Additional Insured. This is commonly done in conjunction with an indemnity agreement between the parties.   Additional Insured status is a method [...]