It is well known that, under New York statutory law, an insurer that fails, in a timely manner, to advise a claimant of a disclaimer to its insured for a bodily injury claim can waive certain coverage defenses. This is a general statement of one aspect of New York Insurance Law § 3420.
In Colony Insurance Company v. Buckeye Fire Equipment Company, the insured was named a defendant in hundreds of underlying suits relating to its manufacture of fire equipment containing aqueous film-forming foam, a fire suppressant.
The New York Supreme Court, Appellate Division, Fourth Department, decided an appeal from a trial court’s 2018 summary judgment ruling on a number of coverage issues arising out of asbestos-related bodily injury claims against plaintiffs Carrier Corporation and Elliott Company.
After an insurance carrier denied a lawyer and her law firm’s claim for lost business income due to the COVID-19-related shutdown, she sued both her carrier and the insurance producer that procured the policy.
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Various theories abound on how to deal with this sprawling coverage litigation. And none of them is ideal. As one counsel put it, is the litigation the nightmare or is consolidation the nightmare?