New York Insurance Coverage Law Update

Policy Endorsement Waived Contribution From Additional Insured’s Insurer, First Department Decides

A claimant sued the New York City Housing Authority (“NYCHA”) for personal injuries, and NYCHA was defended as an additional insured under a policy issued to Women Work Construction Corp. (“WWC”). WWC’s insurer asserted that NYCHA’s insurer had to contribute to NYCHA’s defense. The Appellate Division, First Department, ruled that WWC’s insurer “waived any contribution” from NYCHA’s insurer because WWC’s policy contained a “Primary Non-Contributory Endorsement” that provided that the insurer would “not seek contribution from any other insurance available to NYCHA.”  In addition, the First Department determined that the insurers were not co-primary because the NYCHA policy, by its terms, provided excess coverage to NYCHA. [Endurance Am. Specialty Ins. Co. v. Harleysville Worcester Ins. Co., 2020 N.Y. Slip Op. 00683 (1st Dep’t Jan. 30, 2020).]

Claimant Was “Occupying” Insured Tractor-Trailer When He Was Allegedly Injured, Second Department Says

The claimant alleged that he was injured at the end of his work day as he was stepping down from a ramp attached to his employer’s tractor-trailer and was hit by a passing minivan. The claimant sought supplementary uninsured/underinsured motorists (“SUM”) benefits under his employer’s commercial automobile liability insurance policy. The Supreme Court, Suffolk County, ruled that the claimant was not occupying the tractor-trailer, and he appealed. The Appellate Division, Second Department, reversed, stressing that the SUM endorsement in the policy defined “occupying” as “in, upon, entering into, or exiting from a motor vehicle.” The Second Department found that, as a matter of law, the claimant was “upon” the tractor-trailer at the time of the alleged incident and was therefore “occupying” the tractor-trailer within the meaning of the SUM endorsement. The court reasoned that the claimant’s testimony established that he had stepped upon the ramp, which was attached to the tractor-trailer, and that he was struck by the minivan while his right leg was still on the ramp and he was stepping down with his left leg. The court concluded that his testimony established that he was in physical contact with the vehicle at the time of the accident and was therefore “occupying” it. [Matter of Utica Mut. Assurance Co. v. Steward, 2020 N.Y. Slip Op. 00285 (2d Dep’t Jan. 15, 2020).]

Second Department Finds Triable Issue Of Fact As To Whether There Was A Covered “Accident”

The claimant sued the insured, alleging that he was injured when he was struck by a cup thrown out of a window of a vehicle operated by the insured. The insurer that issued a combination homeowners and automobile policy to the insured filed a declaratory judgment action seeking a declaration that it had no duty to indemnify the insured.  The Appellate Division, Second Department, found a question of fact as to whether there was a covered “accident” because of evidence that the insured intended to douse the claimant with the liquid in the cup but did not intend to throw the cup and strike the claimant with it.  Finding that the claim did not fall within the “narrow class of cases” in which the intentional act exclusion applied “regardless of the insured’s subjective intent,” the court found a triable issue of fact as to whether the event qualified as a covered “accident”. [Unitrin Auto and Home Ins. Co. v. Sullivan, 2020 N.Y. Slip Op. 00452 (2d Dep’t Jan. 22, 2020).]

Claim Filed More Than 60 Days After Policy Period Expired Was Untimely

Advance Transit Co., Inc. was sued in a personal injury action.  Advance’s claims-made insurance policy required that Advance report claims during the policy period or, if Advance renewed the policy, within 60 days after the expiration of the policy period. Advance renewed the policy but reported the claim more than 60 days after the initial policy period expired. Advance contended that Insurance Law § 3420(a)(5) required claims-made policies issued or delivered in New York to include a provision that a claim that arose during the policy period could be reported during the renewal policy period. The Supreme Court, New York County, granted summary judgment in favor of the insurer and held that it had no duty to defend or indemnify Advance. The court opined that the legislative history of Section 3420(a)(5) reflects that it was meant to provide that insurers issuing claims-made policies “need not comply with a [late notice] prejudice showing” if the policy provides that the “claim shall be made during the policy period, any renewal thereof, or any extended reporting period ….”  [Certain Underwriters at Lloyds London v. Advance Transit Co. Inc., 2020 N.Y. Slip Op. 30460(U) (Sup. Ct. N.Y. Co. Feb. 14, 2020).]