Owner Entitled to Additional Insured Coverage Under Contractor’s Excess Policy

Jan 30, 2023

On January 19, 2023, our firm obtained summary judgment in New York state court, New York County, against a general contractor’s excess insurer who denied additional insured coverage for a project owner based on a “late notice” defense.

The owner was sued in an underlying personal injury action involving a slip-and-fall at a construction site. The owner sought additional insured coverage from the general contractor’s primary and excess insurers.  The primary insurer accepted such coverage but the excess insurer denied so our firm, on behalf of the owner, brought a declaratory judgment action against the excess insurer.

The excess insurer argued that it was entitled to notice of the underlying accident at the same time as the primary insurer.  We countered that the excess policy’s notice provisions did not require such notice, the notice to the excess insurer was timely and, regardless, the excess insurer did not suffer any prejudice.  We also argued that the excess insurer waived its “late notice” defense because it failed to comply with N.Y. Insurance Law Section 3420(d)(2) when it issued its disclaimer.  The excess insurer did not send its disclaimer in a timely fashion to the additional insured (project owner) and the underlying claimant, as required under Section 3420(d)(2) and the case law.

The New York trial court agreed with our argument. It held that the excess insurer’s disclaimer did not comply with Section 3420(d)(2) and thus the excess insurer waived its “late notice” defense, thereby entitling the owner to full additional insured coverage under the excess policy.

This case was handled by our firm’s Jon Kranz (jkranz@londonfischer.com) and Brian Kalman (bkalman@londonfischer.com).