All Sums v. Pro Rata: Allocating Damages in Insurance Claims

Indemnification Strategies in Continuing Property Damage and Personal Injury Claims

New Massachusetts high court ruling contradicts California Stringfellow decision

Recording of a 90-minute CLE webinar with Q&A


Conducted on Tuesday, September 29, 2009

Recorded event now available

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Program Materials

This seminar will discuss the new Massachusetts supreme court ruling that adopts pro-rata allocation of liability for covered continuous injury claims in light of a recent California decision that permitted stacking of policy limits. The panel will outline best practices for counsel to policyholders and insurers.

Description

Policyholders and insurers alike should fully review two recent significant court decisions to understand how liability may be allocated by the courts: Massachusetts' Boston Gas Co. v. Century Indemnity Co. and California's State of California v. Continental Insurance Co.

In July 2009, the Massachusetts Supreme Judicial Court gave a major victory to insurers. The court adopted a pro rata time-on-the-risk allocation for long-term loss. The decision impacts insurers and policyholders facing claims for progressive injury that might have started years ago.

This decision is contrary to a landmark California appeals court ruling earlier this year (also called the Stringfellow litigation) that a policyholder facing long-term property damage or personal injury claims may stack liability policy limits across policy periods to maximize recovery.

Listen as our authoritative panel of insurance law attorneys examines methods of liability allocation, the Massachusetts and California rulings, and the implications of the decisions nationwide. The panel will offer best practices for addressing indemnity issues in long-term injury claims litigation.

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Outline

  1. Allocation of liability
    1. All sums rule
    2. Pro rata/Time on the risk allocation
    3. Anti-stacking clauses
    4. Loss mitigation
    5. Annualization
    6. Allocation in defense cases—how are defense costs shared
  2. Court treatment
    1. Boston Gas Co. v. Century Indemnity Co.
    2. State of California v. Continental Insurance Co.
    3. Implications of the rulings
    4. Court treatment in other jurisdictions
  3. Best practices for addressing indemnity issues in long-term injury claims litigation

Benefits

The panel will review these and other key questions:

  • What is the impact of these decisions for Massachusetts insurance litigants? For insurers and policyholders outside Massachusetts?
  • How does the Massachusetts pro rata allocation decision compare with California's decision that permitted stacking of liability policy limits across policy periods?
  • What steps can policyholders and insurers take to recover damages or defend coverage under policies when facing long-term property damage or personal injury claims?

Faculty

Laura A. Foggan
Laura A. Foggan

Partner
Wiley Rein

She co-chairs the firm’s Appellate Practice and is a member of the Insurance Practice. She advises and represents...  |  Read More

Robert M. Horkovich
Robert M. Horkovich

Shareholder
Anderson Kill & Olick

He has substantial experience in trying complex insurance coverage actions for corporate policyholders. The Chambers...  |  Read More

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