October 2026 New York Insurance Coverage Update

Second Circuit Holds Insured’s Admission Of Responsibility For Defective Work Violated Policy Condition

Tindall Corporation, a designer and manufacturer of concrete structures, sought coverage under a Berkley Assurance Company professional liability policy for costs it incurred to correct defective concrete beams Tindall designed for a contractor. As a condition precedent to coverage, the policy requires Tindall to obtain Berkley’s consent before making any payment, assuming or admitting liability, consenting to a judgment, or agreeing to a settlement. After discovering there was an error in the beams it designed, Tindall acknowledged to the contractor that the beams did not comply with the contract specifications. Later, Tindall again acknowledged “nonconforming portions of its work” and proposed “substantial ‘corrective measures.’” It was not until after a remediation plan for the defective work was approved and contractors to perform the corrective work were identified that Tindall notified Berkley of the potential claim relating to its design work. Berkley denied coverage and Tindall sued. The Western District of New York granted Berkley summary judgment, declaring that Berkley is not obligated to cover Tindall’s costs to correct its defective beams because Tindall admitted liability for the defect without Berkley’s consent. Tindall appealed and the Second Circuit affirmed, rejecting Tindall’s argument that the consent condition in Berkley’s policy is triggered only by a “binding settlement agreement.” The Second Circuit explained that the “policy’s plain text … clearly covers more than just settlement agreements.” The court also rejected Tindall’s argument that its acknowledgement that the beams did not conform with contract specifications was not an admission of liability, finding “no other inference ‘could rationally be drawn.’” In addition, the Second Circuit held that Berkley does not need to prove it was prejudiced by Tindall’s admission of liability to deny coverage because Berkley’s consent for such an admission is a condition precedent to coverage under the policy. [Tindall Corp. v. Berkley Assur. Co., No. 25-1448, 2026 WL 2935597 (2d Cir. Sept. 30, 2026)].

Eastern District Holds Exclusions In Homeowners And Personal Umbrella Policies Bar Coverage For Bodily Injury Action By One Named Insured Against Another Named Insured

Amica Mutual Insurance Company began issuing homeowners and personal umbrella liability policies to Donald and Joann Ambrosio as named insureds in 2012 when the Ambrosios were married and living in their home in Commack, New York. The policies were renewed each year, including for the policy period from August 2022 to August 2023. By that time, the Ambrosios were separated but not yet divorced and Joann no longer owned or resided at the home. In June 2023, while Joann was visiting her daughter at the home, Donald allegedly pushed her and she sustained injuries. Joann sued Donald for damages, alleging negligence and assault and battery. The Ambrosios sought coverage under the Amica policies and Amica denied coverage based upon an exclusion in both policies for bodily injury to “you,” defined as the “named insured.” Despite the denial, Amica provided Donald with a defense and filed an action seeking a declaration of no coverage under the policies. The Eastern District of New York granted Amica summary judgment, declaring that Amica is not obligated to defend or to indemnify Donald in the lawsuit brought by Joann because Amica’s policies exclude coverage for bodily injury to Joann, a named insured under the policies. The court rejected the Ambrosios’ argument that the exclusions do not apply because Joann previously transferred her ownership interest to Donald and no longer resided at the home. The court explained that the argument erroneously focuses on policy language extending insured status to a named insured’s spouse who does not otherwise qualify as an insured “if a resident of the same household.” Because Joann is expressly identified as a named insured under the policies, it is immaterial that she no longer owned or resided at the home. The court also rejected the Ambrosios’ argument that Joann cannot be an insured under the policies because she transferred her ownership interest to Donald and, thus, does not have an insurable interest in the home. The court explained that such an interest is not required for liability policies. [Amica Mut. Ins. Co. v. Ambrosio, 25-cv-3296, 2026 WL 2906531 (E.D.N.Y. Sept. 28, 2026)].