Author: pfadmin

THE PROCESS OF REGULATING PFAS CONTAMINATION IS HEATING UP

BY KRISTEN DRAKE 

Perfluoroalkyl and polyfluoroalkyl substances (PFAS) are part of a very broad chemical group that have found their way into commercial and industrial use due to their unique chemical properties that repel oil and water and resist temperature, chemicals, and fire. This means PFAS are everywhere. Also, PFAS are known as “forever chemicals”, which means concerns surrounding PFAS will not be going away anytime soon. Federal and state regulators are looking closely at PFAS exposure, and several studies are being conducted that will result in additional regulations.

As an emergent contaminant resistant to degradation and requiring substantial remediation, PFAS are currently the subject of increased scrutiny by environmental regulators, private party plaintiffs, manufacturers, and the insurance industry. Currently, the federal government has no enforceable environmental regulations of any kind that address PFAS chemicals, but recently, the federal government has issued interim health advisories about the human health effects of PFAS chemicals. As the federal government narrows in on acceptable screening levels, the EPA is preparing to propose new mandatory standards for PFAS chemicals in the fall.

Several states aren’t waiting for federal regulations concerning PFAS in the environment and are pushing forward with demands to sample environmental media for PFAS at some active remediation sites. Now, is the time to address PFAS exposures and seek out coverage.

HISTORICAL COMMERCIAL GENERAL LIABILITY INSURANCE SHOULD BE TENDERED TO PAY FOR PFAS INVESTIGATION, CLEANUP, REMEDIATION, AND LEGAL DEFENSE

Those who used or interacted with PFAS during their business operations can face a variety of exposures due to PFAS including product liability, bodily injury, and environmental cleanup claims. Insureds should be ready to use their commercial general liability (CGL) policies written prior to 1986 to pay for the investigation, remediation, and legal defense of PFAS.

Three reasons why PFAS related damages fit into the pollutant pre-exclusion:

1. Older CGL policies typically apply to an “occurrence” rather than “claims-made basis”, which means the policies in place when there was property damage during the policy period should continue to apply, even if the liability does not appear until decades later. So, for substances now seen as “emerging contaminants” that have been in the soil, groundwater, or otherwise since the 1960s, 1970s, or 1980s, CGL policies from those years can pay for environmental investigation, cleanup, and legal defense. This means older CGL policies insure business owners against claims for property damage like contamination and bodily injury. Similar claims involving PFAS should be no different.

2. Older CGL policies, prior to 1986, did not include the absolute pollution exclusion (including PFAS). This means older CGL policies can cover long-tail claims, such as environmental, investigation, cleanup, and legal counsel fees. Again, similar claims involving PFAS should be no different.

3. Applicable CGL insurance policies never expire. PFAS claims don’t change this fact.

If you feel that you or your business may gain liability from the formal regulation of PFAS chemicals as hazardous substances, contact PolicyFind as soon as possible to get your historical CGL portfolio in order.

PolicyFind is watching the development of insurance coverage related matters regarding PFAS and very closely, not only for bodily injury claims but also for property damage claims related to the investigation and cleanup of subsurface contamination. Significant rulings and opinions will be shared in future blog posts. For questions or more information, please contact us.

 

LAW ELIMINATES STATUTE OF LIMITATIONS ON SEXUAL ASSAULT FOR ONE YEAR 

BY: KRISTEN DRAKE

On May 24, 2022, New York Governor, Kathy Hochul, signed the Adult Survivors Act (ASA) into law.  The ASA creates a one-year ‘Lookback Window’ which opens on November 24, 2022, to allow survivors who were adults (18 and older) at the time they were sexually abused and assaulted to sue their abusers – regardless of when the offenses occurred. 

In 2019, the state of New York enacted the Child Victims Act (CVA) which opened a ‘Lookback Window’ to commence civil actions.  The CVA was extended another year due to the COVID-19 pandemic, and when the window closed in August of 2021, nearly 11,000 lawsuits had been filed. During the CVA lookback window, countless churches, schools, foster care agencies, and youth-based organizations were obliged to respond to the alleged abuses. An important differentiation between the CVA and the ASA, is the age of the survivor when the sexual abuse or assault occurred, although both fall under the broader category of reviver statutes. Prior to the ASA, reviver statutes focused primarily on abuses against children.  With this new law, it’s likely that different types of organizations will face allegations dating back decades, because the survivors were 18 and older when the sexual assault or abuses happened. This expansion may include accusations made regarding assaults at colleges, in the workplace, and/or health care facility abuses – to name a few. 

DECADES-OLD OCCURRENCE-BASED GENERAL LIABILITY POLICIES CAN HELP
When states enact these lookback windows, removing or reducing the statute of limitations for sexual abuse civil suits, organizations that were proximal to alleged abuses can get caught in the crossfire between plaintiffs and alleged offenders. Occurrence-based Commercial General Liability (CGL) policies issued during the policy periods in which the alleged abuse occurred can respond to these new claims – even if the alleged abuse happened in the 1960s.   

DEFENDANT ORGANIZATIONS SHOULD CONSIDER INSURANCE ARCHEOLOGY
As more organizations are compelled to identify and locate their decades-old liability policies to help pay damages, they are oftentimes disheartened to learn how difficult it can be. Since the time of interest in reviver statute claims is oftentimes at least 40 years ago, many records could be lost, destroyed by fire or flood, or purposely purged.   

Upon receiving notice that a lawsuit has been filed against them under a reviver statute, defendant organizations should contact their attorneys, who typically suggest contact with their current insurance agents and brokers. Because of standard document retention practices, these companies quickly learn their current agent/broker has no information dating back decades. It’s at this point or perhaps following a fruitless internal archive search, that defendant organizations should consider Insurance Archeology.

Insurance Archeology is the practice of locating and retrieving proof of the existence, terms, conditions, and limits of lost or destroyed insurance policies. PolicyFind’s expertise is finding and bringing to light old insurance coverage for our clients. Under current and future reviver statutes across the country, historical CGL policies issued to businesses, schools, churches, and other organizations, are the first line of assets to be explored to pay for claims against them. 

Contact PolicyFind today to learn more about your organization’s historical liability insurance portfolio. 

---

Kristen Drake brings more than a decade of research and managerial experience in broadcast journalism to the field of insurance archeology. Since joining the PolicyFind team in 2015, Mrs. Drake has successfully documented liability insurance programs on behalf of municipalities, manufacturers and dry cleaners. She continues to translate her expertise in source procurement and digital fact-finding, performing insurance research activities at a very high level, providing on-time execution of contracted performance goals.

ON MARCH 24, 2022, THE APPELLATE DIVISION OF THE SUPREME COURT OF NEW YORK, FIRST DEPARTMENT, ISSUED A NOTEWORTHY RULING IN CERTAIN UNDERWRITERS AT LLOYD’S, LONDON, ET AL. V. NL INDUSTRIES, INC., 2022 NY SLIP OP 02056.

BY: JOSEPH  M. JUNFOLA, CPCU

The case is noteworthy for a few reasons in terms of the interpretation of insurance coverage and issues like the fortuity doctrine, expected/intended consequences, legal damages versus equitable relief, and the definitions of bodily injury and property damage. 

Another notable aspect of this case, and one that should never be underestimated, is the asset value of historical insurance policies. In this case, this value is in the tens of millions of dollars. 

But first, a little background. 

LEAD ABATEMENT AND INSURANCE COVERAGE IN CALIFORNIA 

In March 2000, Santa Clara County filed a class-action lawsuit against manufacturers and promoters of Dutch Boy lead-based paints. NL Industries, a defendant, allegedly promoted the use of interior residential lead paint with knowledge of the danger to children. 

Eleven years later, the case evolved into the Government Plaintiffs (including Santa Clara County) filing a fourth amended complaint asserting a claim for representative public nuisance on behalf of the People. Tried in Summer, 2013, the Court found in favor of the People and, in March 2014 filed an amended statement of that ruling requiring the defendants to pay $1.15 billion into an abatement fund. 

After appeal from the defendants and remand, in July 2019 the Court approved a $305 million settlement. NL’s share was $101.6 million and, as of that date, had already paid $25 million. 

The Court of Appeal affirmed that the plaintiffs must, and did, establish the defendants’ actual knowledge of the hazards of lead paint, including childhood lead poisoning, to sustain a claim for representative public nuisance. And the defendants knew this as early as the 1920s.  

As to the remedy, the abatement of the representative public nuisance alleged on behalf of the People is equitable in nature and does not provide for a damages remedy. The defendants argued, unsuccessfully, that the abatement was “a thinly disguised damages award.”  Had the defendants succeeded, the claim would likely have been defeated since only equitable relief is available for a representative public nuisance claim. 

This is significant because equitable relief is arguably not covered in a CGL policy, one of the arguments that the insurers made in the subsequent coverage action. 

LEAD ABATEMENT AND INSURANCE COVERAGE IN NEW YORK 

The carriers pursued a coverage action in New York and in late December 2020, Certain Underwriters at Lloyd’s, et al. v. NL Industries, Inc., 2020 NY Slip Op 34331 (U), applying New York law, ruled against the carriers’ position that NL’s liability in the California action was not covered. 

In support of their motion for summary judgment, the carriers argued: 

1. Because of NL’s knowledge of the danger of lead paints, it was held liable for the intentional and affirmative promotion of hazardous lead paint for interior residential use, giving way to expected or intended consequences and, therefore, is not covered. 
2. Only “damages” or “damages and expenses” are covered. The abatement remedy was neither, as it constituted equitable relief only as the California court explicitly ruled. 
3. Even if the abatement remedy could somehow be damages, it must be “because of” property damage or bodily injury as provided for in the policies and neither were “elements of the claim.” 

The first argument failed. The Court ruled that, as to the expected/intended argument, in New York there is a distinction between knowledge of the risk of hazardous consequences as to one’s behavior and the intention to cause harm. The carriers failed to make a prima facie case that NL’s action was uninsurable. Furthermore, as to intent, the carriers failed to demonstrate that the alternative to expected/intended, i.e., the codified fortuity doctrine, precluded coverage. 

The second argument failed as well. While the abatement remedy did not constitute damages in California, but instead was an equitable remedy, the New York court found for insurance coverage purposes, “that the abatement fund was not strictly intended to prevent harm, but was monies paid to the government, depleted by its ongoing efforts to remediate the longstanding contamination of houses and buildings by lead paint in California. It, therefore, qualifies as damages under the applicable policies.” 

Finally, the New York Court ruled that while it agreed that property damage and bodily injury are not elements of the People’s representative public nuisance claim, there was a “connection between the lead poison injuries to the children residing in the buildings containing the lead paints promoted by NL and the property damage to those buildings as a result of NL’s promotion of lead paint.” 

The carriers’ motion for summary judgment was denied and they appealed, bringing us to March 24, 2022, and the Appellate Division of the Supreme Court of New York, First Department’s ruling that the Supreme Court correctly denied the motion. Noteworthy is the Appellate Division’s concurrence that despite the ruling by the California court that abatement payments were not damages, they, “had a compensatory effect, which qualified them as damages under the applicable law and insurance policies.” 

THE VALUE OF OLD POLICIES 

On July 24, 2019, the Superior Court issued an Order and Judgment approving a $305 million settlement, of which NL’s share is $101.6 million, and of which NL had already paid $25 million.  

According to NL, Insurers issued or subscribed to 320 policies for NL between 1949 and 2000. More specifically, “between 1949 and 1997, approximately $1.285 billion (43%) in coverage was bought while NL was headquartered in New York, while approximately $1.690 billion (57%) in coverage was negotiated and delivered to NL at its Texas headquarters.” 

In a footnote, it is pointed out that NL believes it purchased policies from the insurers as far back as 1946 but has not located them. Given the ages of the policies, NL was fortunate to have found the policies it did.  The value of old policies as financial sources in long-tail liability claims cannot be stressed enough.  

Contact PolicyFind today to learn more about how we can help you find evidence of your organization’s historical coverage. 

---

Joseph Junfola’s insurance claim career spans 43+ years with experience managing, directly or in a supervisory capacity, commercial and personal lines of insurance claims. For the last 29 years, he has specialized in commercial long-term exposure or continuous property damage, bodily injury and personal injury claims on a national basis primarily involving construction defect, environmental, toxic tort, product liability, and design professional liability claims. He frequently collaborates with underwriting professionals to draft and redraft policy language. His experience also includes construction accident claims, particularly third-party-over actions in New York.

LEARN ABOUT REVIVER STATUTES THAT ARE CROPPING UP ACROSS THE COUNTRY AND HOW INSURANCE ARCHEOLOGY IS FINDING APPLICABLE INSURANCE COVERAGE FOR THESE CLAIMS

BY: KRISTEN DRAKE

Churches, school districts and youth-based organizations across the country continue to face new claims of childhood abuse or molestation from survivors, due to increasing legislation in certain jurisdictions related to ‘reviver’ or ‘window’ statutes. Although named more specifically in each applicable state, reviver statutes in general are intended by lawmakers to give victims more time to make such allegations, outside of established statute of limitations parameters. Amidst the high-profile news stories of abuse claims against the American Gymnastics Association, The Boy Scouts of America, and the Roman Catholic Church, an increasing number of claims are also being made by abuse survivors against much smaller institutions. PolicyFind has been assisting survivors and these institutions across the country by conducting Confidential Insurance Archeology® and finding applicable insurance coverage from the past.

NEW YORK’S CHILD VICTIMS ACT (CVA)
An early and well-known reviver statute in the State of New York is called the Child Victims Act (CVA), which was enacted in August of 2019. The CVA was crafted by lawmakers to allow victims of childhood sexual abuse a one-year lookback window to commence civil actions, previously time-barred, against public and private institutions. The CVA was ultimately extended an additional year due to COVID-19. The Child Victims Act window closed on August 14, 2021, with nearly eleven thousand lawsuits filed.

SIMILAR ‘REVIVER’ OR ‘WINDOW’ STATUTES IN OTHER STATES
Another state that was early to enact a reviver statute was New Jersey. The legislation (S-477) was enacted on December 1, 2019 and extended the civil statute of limitations for survivors of child sexual abuse. This extension opened a two-year window for those alleging abuse and sunset in December of 2021. 

Earlier in 2021, Colorado’s governor signed into law a three-year look-back window that eliminates the civil statute of limitations for sexual assaults to include both minors and adults. This law provides that civil suits can be made for abuse claims dating back to 1960, it limits damages that can be awarded depending on the defendant type.

Most recently, on August 1, 2021, Louisiana opened a three-year window for survivors of childhood sexual abuse to seek damages in civil court; and, in Maine, a permanent revival window has opened to include all expired claims of child sexual abuse.

HOW INSURANCE ARCHEOLOGY CAN BE VALUABLE DURING REVIVER STATUTE PROCEEDINGS
As reviver statutes become more prevalent, smaller institutions and organizations, like schools, churches, and foster care agencies, are facing civil actions with allegations dating back decades.  Occurrence-based CGL policies issued during the time period in which the alleged abuse occurred are being triggered by the policyholding institutions with increasing frequency. Since the time of interest in reviver statute claims is oftentimes at least 40 years ago, the tricky part is actually finding those old CGL policies.

While the respective windows to file civil lawsuits in New York and New Jersey have closed, many institutions still need to locate their historical occurrence-based general liability policies to respond to claims. Many school districts and churches have attempted to locate this information, without assistance, and have come up empty-handed, with strict deadlines still looming. 

Insurance Archeology is the practice of locating and retrieving proof of the existence, terms, conditions, and limits of lost or destroyed insurance policies. PolicyFind’s expertise is the location and recovery of historical CGL policies issued to school districts, churches, and other youth-based organizations, to pay for current claims against them.

Contact PolicyFind today to learn more about how we can help you find evidence of your organization’s historical coverage.

---

Kristen Drake brings more than a decade of research and managerial experience in broadcast journalism to the field of insurance archeology. Since joining the PolicyFind team in 2015, Mrs. Drake has successfully documented liability insurance programs on behalf of municipalities, manufacturers and dry cleaners. She continues to translate her expertise in source procurement and digital fact-finding, performing insurance research activities at a very high level, providing on-time execution of contracted performance goals.

LIQUIDATION AND COMPANIES AFFECTED

According to the Pennsylvania Insurance Department, on March 11, 2021, Pennsylvania Commonwealth Court placed Bedivere Insurance Company, formerly known as OneBeacon Insurance Company, into liquidation. Bedivere’s liquidation affects the following companies: Lamorak Insurance Company – formerly known as OneBeacon America Insurance Company, Potomac Insurance Company, and Employers Fire Insurance Company. By way of historical succession and merger, property and casualty carriers American Colonial, General Accident Insurance Company of America, and Commercial Union Insurance are also impacted within this liquidation.

IMPACT
This liquidation action has a potentially far-reaching impact in the world of long-tail, toxic tort, and latent injury claims, which are typically covered by general liability policies formerly written by companies like those under Bedivere. In these instances, historical insurance portfolios that include an allocated share to a Bedivere company could be missing a key piece of the coverage equation; thereby putting a financial burden on policyholders and other participating carriers alike

CLAIMS DEADLINE
If you believe you have a claim or a subrogation to file with the Bedivere Insurance Company, a deadline of December 31, 2021 has been set for a receipt of claims. If claims are not submitted by that date, your claim may be denied or considered at a ‘lower priority level’.

LEARN MORE
For more information about the liquidation action, frequently asked questions, and filing deadlines, please visit the Pennsylvania Insurance Department here: https://www.insurance.pa.gov/Regulations/LiquidationRehab/Pages/Bedivere-Insurance-Company.aspx

If you’re facing a long-tail liability, toxic tort, or latent injury claim and the carrier names listed in this post sound familiar, please contact PolicyFind. There is still time for our team to help you locate and present your evidence of coverage and to submit Proof of Claim, ahead of the Claims Bar Date set for the end of this year.

By David A. O’Neill JD

POLICYFIND’S CO-FOUNDER & DIRECTOR OF INVESTIGATION, DAVID O’NEILL, JD, EXPLAINS THE DECISION IN COLONY INSURANCE COMPANY V. BUCKEYE FIRE EQUIPMENT CO.

The U.S. District Court for the Western District of North Carolina ruled on October 19, 2020 that the “hazardous materials” exclusion in a 2008 CGL policy did not apply to relieve the insurer of its duty to defend a manufacturer of fire suppressant foam against allegations of bodily injury from direct product exposure. The court’s decision appears to be the first of several hundred cases consolidated in North Carolina alleging bodily injury and property damage from exposure to products containing perfluoroctane sulfanate (PFOS) and/or perfluorooctanic acid (PFOA).

In Colony Insurance Company v. Buckeye Fire Equipment Co., Colony sought the Court’s declaration that its “hazardous exposure” exclusion applied to bar its duty to defend in a case where a firefighter was significantly exposed to elevated levels of PFOS and PFOA in his demonstration and application of Buckeye’s products. The Colony policy defined “hazardous materials” in part as “pollutants” and defined “pollutants” as “any solid, liquid, gaseous irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste.”

Looking to North Carolina law, the District Court cited a 1991 case styled West American Insurance Co. v. Tufco Flooring East, Inc. in which the state court of appeals found a duty to defend despite the presence of a pollution exclusion. The Tufco court characterized the terms used in the pollution exclusion as “environmental terms of art” and reasoned that any “discharge, dispersal, release or escape of pollutants” therefore needed to be into the environment to trigger the pollution exclusion and deny coverage to the insured.

Further, the District Court found that the Tufco rule had been applied in a 4th Circuit Court of Appeals case styled Auto-Owners Insurance Co. v. Potter where the insured was sued for bodily injury based on contact with contaminated water. That court had determined that “under North Carolina law, an insurer may not deny coverage to an insured based on a pollution exclusion, or any variation thereof, if the occurrence and the resulting injury and property damage allegedly suffered….are not the prototypical environmental harms that a pollution exclusion clause is generally intended to protect against.”

Applying the Tufco rule to the Colony Insurance Company case, the District Court determined that the firefighter’s bodily injury complaint did not allege the “prototypical environmental harm” that the pollution exclusion was intended to protect against. Hence, the exclusion was ineffective to bar the insurer’s duty to defend.

LOOKING FORWARD
This decision by the U.S. District Court for the Western District of North Carolina is expected to be indicative of its future decisions in the underlying cases as it applies the law of the various states to issues identified here concerning the use of firefighting products containing PFOS and PFOA. The underlying cases include those from Maryland, Washington and New Hampshire – all states where courts have found personal injury can result from exposure to pollutants. Also, this North Carolina decision did not determine whether the insurer had the duty to indemnify, only that it had the duty to defend. That issue remains to be decided in the various cases.

PolicyFind is an insurance archeology firm and the nation’s leader in locating historical insurance coverage that applies to latent injury claims.

If you represent clients whom are impacted by direct exposure injury claims, contact us for a confidential consultation.

---

David A. O’Neill, Director of Investigations

David O’Neill has over 20 years of experience in claims recovery on behalf of corporate policyholders involving environmental property damage and toxic tort and asbestos exposure claims. He is an accomplished insurance archeologist with extensive experience in locating and retrieving insurance coverage evidence on behalf of potentially responsible parties responding to environmental investigation and remediation demands. Mr. O’Neill is also an experienced PRP investigator with knowledge of CERCLA/SARA requirements, having conducted over thirty PRP searches at Superfund hazardous waste sites for PRP defense counsel and previously for USEPA Regions V and VIII. Mr. O’Neill was formerly Insurance Research Manager for Risk International Services, Inc. He graduated from Case Western Reserve Law School in 1986.

 

POLICYFIND’S CO-FOUNDER & DIRECTOR OF INVESTIGATIONS, DAVID O’NEILL, JD, DISCUSSES THE KEY STARTING POINT TO INSURANCE ARCHEOLOGY SUCCESS

PolicyFind’s Co-Founder and Director of Investigations, David O’Neill, JD, has over 20 years of experience in claims recovery on behalf of corporate policyholders involving environmental property damage, toxic tort and asbestos exposure claims. In 2001, he and Steve Henshaw founded PolicyFind after discovering that attorneys needed insurance archeology for a variety of other client projects outside of funding environmental cleanup and legal defense.

Since then, David and the rest of the insurance archeology team at PolicyFind have located over $5 billion dollars in usable insurance assets. He has personally worked on over 700 projects including the reconstruction of insurance coverage for the countrywide rollup of the nation’s largest waste disposal company.

In David’s time as an insurance archeologist, he’s heard just about every question you can possibly think to ask about insurance archeology services, and how they can benefit a policyholder. David answers the most common question he says he hears is, “What is the likelihood you can find my lost policies?”

WHAT IS THE LIKELIHOOD YOU CAN FIND LOST POLICIES?
In order to answer this question, I first have to ask, “To what business records of the insureds do you have access?” Our likelihood of success improves when we have some business records to reference as we get started. We are not talking insurance documents here, although that would be great. We are only asking for correspondence or property records—really just anything from those years in which the alleged harm occurred that is the basis of the claim.

Learn our three tips for starting an insurance archeology project.

More often than not, a client or their attorney will overlook these documents. The attorney may not even know to ask for them. But they are incredibly valuable. These documents may not be actual policies, but they can potentially help us track down other evidence of coverage.

Often our clients come to us empty-handed, but after working with them, we discover business records exist. We would much rather you have access to these documents before you approach us. That way we’re not spending our initial efforts searching for business records in the hands of others.

I recommend that attorneys become better acquainted with their client’s corporate history and the records their client generated during the course of that history. We will be glad to assist in this process and the likelihood of our success will be greatly improved.

Contact us for a free confidential consultation.

---

 

[et_pb_section fb_built=”1″ _builder_version=”3.22″][et_pb_row _builder_version=”3.25″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” min_height=”621px”][et_pb_column type=”4_4″ _builder_version=”3.25″ custom_padding=”|||” custom_padding__hover=”|||”][et_pb_text _builder_version=”4.5.3″ background_size=”initial” background_position=”top_left” background_repeat=”repeat”]

Insured’s Awareness of Opioid Epidemic, not a Known Loss

By David A. O’Neill, JD

A Delaware state court has ruled that Rite Aid pharmacies, defendants in thousands of lawsuits alleging tortious distribution of opioids, can receive reimbursement from their insurer for their defense expenditures. On September 22, 2020, the Delaware Superior Court in New Castle, Delaware issued its opinion, granting Rite Aid’s motion for partial summary judgment in the case styled Rite Aid Corp. et al v. ACE American Insurance Company et al. The opinion addressed those suits brought by governmental entities against Rite Aid Corp. alleging that it knowingly distributed and improperly dispensed opioids to their citizens, contributing to drug abuse, addiction, injury and death.

In Rite Aid Corp. et al v. ACE American Insurance Company et al, Rite Aid brought a suit against Chubb Ltd. Rite Aid alleged breach of contract for Chubb’s denial of coverage under a 2015 insurance policy that contained a $3 million self-insured retention. While not deciding the merits of the Rite Aid suit, the Delaware court liberally construed the Chubb policy’s “duty to defend” clause in ruling that the government suits “and all Opioid lawsuits alleging similar claims are potentially covered under the policy.”

The court rejected the insurer’s argument that Rite Aid’s “knowledge of personal injury, and the opioid epidemic” prior to the 2015 insurance policy’s effective date constituted the kind of “known loss” or “loss-in-progress” that would relieve its insurer’s obligations.  The court also ruled that Rite Aid’s “inadequate action“ in the “distribution and dispensing” of opioids constituted “a single occurrence” under the policy, rather than multiple occurrences, so that Rite Aid would need to only ante its $3 million once, rather than for each suit.

PolicyFind will monitor this evolving situation to learn if Rite Aid Corp. et al v. ACE American Insurance Company et al may set a precedent for other carriers providing coverage to those associated with litigation in opioid matters.

If you have any questions, contact PolicyFind.

[/et_pb_text][et_pb_divider color=”#000000″ _builder_version=”4.5.3″ _module_preset=”default”][/et_pb_divider][/et_pb_column][/et_pb_row][et_pb_row _builder_version=”4.5.3″ _module_preset=”default”][et_pb_column type=”4_4″ _builder_version=”4.5.3″ _module_preset=”default”][et_pb_text _builder_version=”4.5.3″ _module_preset=”default”]

David A. O’Neill, Director of Investigations

David O’Neill has over 20 years of experience in claims recovery on behalf of corporate policyholders involving environmental property damage and toxic tort and asbestos exposure claims. He is an accomplished insurance archeologist with extensive experience in locating and retrieving insurance coverage evidence on behalf of potentially responsible parties responding to environmental investigation and remediation demands. Mr. O’Neill is also an experienced PRP investigator with knowledge of CERCLA/SARA requirements, having conducted over thirty PRP searches at Superfund hazardous waste sites for PRP defense counsel and previously for USEPA Regions V and VIII. Mr. O’Neill was formerly Insurance Research Manager for Risk International Services, Inc. He graduated from Case Western Reserve Law School in 1986.

[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section]

By: Kristen Drake

Insurance Archeology is the practice of locating and retrieving proof of the existence, terms, conditions and limits of lost or destroyed insurance policies. Insurance Archeology is performed to find funds to pay for environmental cleanup and defend against third-party liabilities. When leveraged, these historical insurance policies are assets that can be worth millions of dollars in legal defense, cost-sharing of defense, and settlements.

A lot of people wonder how it’s possible new claims can still be made against old policies. First, you should know that these policies never expire. To explain a bit further, we are interested in Commercial General Liability or “CGL” policies.  More specifically, we search for ‘occurrence-based’ policies—meaning policies which cover losses if the damage happened during the time the policy was in effect, regardless of when a claim is filed.

Regarding environmental cleanups, it’s important to note that while CGL insurance policies written prior to 1985 or 1986 contain pollution exclusions, those exclusions contain a clause that created an exception for “sudden and accidental” releases of contaminants. That exception is considered ambiguous by many courts, or they read the word sudden broadly, to, therefore, provide coverage. Old policies or evidence of insurance coverage can provide a defense against a claim or suit. In some states, a claim or suit could be a letter from the environmental regulatory agency, or a neighboring property owner – demanding a response to identified environmental contamination. In other states, the courts have determined that the insurers must only defend an actual lawsuit. 

Regarding latent injury liability, like mesothelioma claims linked to asbestos exposure, old policies can be used to resolve complex claims involving events that occurred decades ago. These liabilities may be covered under old insurance policies which tend to be less restrictive and provide broader coverage. Even policies of bankrupt and defunct companies are commonly used to defend current claims. An interesting facet of Insurance Archeology is that it can be employed by either party involved in these types of lawsuits.  PolicyFind is engaged equally by Plaintiffs’ Attorneys and Defense Counsel related to latent injury claims.

Once triggered, historical CGL policies may be used to for legal fees, defense against claims, site investigation, remediation/cleanup, interim remedial measures, building a legal case, potentially responsible party (PRP) searches, and interfacing with agencies; and, prior costs be may be retroactively recovered.

At PolicyFind, we have a disciplined process to ensure objectives are established and deliverables are beneficial and cost-effective. If you’re considering insurance archeology, here are three tips to get started.

TIP #1 – BECOME YOUR BUSINESS’ (PROPERTY’S) HISTORIAN

Try to learn what you can about former owners and/or operations before speaking with an Insurance Archeologist. If old documents no longer exist, consider making a call to former stakeholders or associates.  These people might recall key pieces of information that could lead you closer to finding your old insurance coverage information. If your research efforts don’t yield the results needed to prove your historical coverage, the good news is you are now able to share what new background information you have uncovered, with an Insurance Archeologist.  The more information you learn and can share, the more time the investigator can spend focusing on finding your old policies, instead of researching your business’ (property’s) history.

As it pertains to ‘old’ documents in your possession, we find many people only keep records for seven years, as this is the customary time that the IRS tells us we need to keep records for audit purposes. If ‘old records’ exist, as a ‘Historian’, it is your job to assume there is no such thing as a useless piece of paper. Certain documents may seem unimportant or irrelevant to an insurance investigation, but those are exactly the records that could provide valuable clues to the trained expert. Items of importance could include receipts, old financial ledgers, deeds, and leases. Gather what you are able and be prepared to share what you’ve learned with your Insurance Archeologist.

TIP #2 – COLLECT TOGETHER ALL YOUR INSURANCE POLICIES AND EVIDENCE OF INSURANCE

Business and property owners should make it a high priority to search, locate and securely store all of their old insurance policies and any evidence that may support that they had historical insurance. Looking for insurance coverage reduces personal liability and maintains the value of businesses.

Pull together your Commercial General Liability or CGL policies, which are your normal everyday business insurance policies. Other policies can also be valuable – those include the Excess or Umbrella Liability policies, property insurance policies and Directors & Officers Liability policies, which are policies that insure business owners against claims for property damage and bodily injury.

TIP #3 – CALL AN INSURANCE ARCHEOLOGIST AND DISCUSS YOUR OPTIONS

Because there is no “one-size fits all” approach to Insurance Archeology, each investigation to locate historical insurance assets is as different and varied as our clients and their set of circumstances. The best way to accurately assess whether insurance archeology is the right option for you is to speak with an insurance archeologist who can learn more about your situation and advise you accordingly.

Insurance Archeologists do much more than just dig through files. Because no vault or database exists in which old insurance information is held, we conduct personal interviews, review public records, and we review any and all business records to look for new leads.

PolicyFind shares a common goal with our clients – to find historical insurance assets that can respond to long-tail liability and/or latent injury claims. Our collaboration with our clients begins with an initial discussion. To that end, PolicyFind’s experienced insurance archeologists offer our future clients a free initial consultation to determine potential paths forward to cost recovery. 

For a confidential consultation, please fill out our form.  

---

Kristen Drake, Director of Operations

Kristen combines her profession as an insurance archeologist with over 10 years as an investigative journalist to reconstruct historical insurance coverage for clients. She has successfully located evidence of liability insurance coverage on over 250 projects. Kristen works on behalf of policyholders defending against environmental toxic tort and asbestos exposure, carriers seeking cost allocation, and plaintiffs and defense attorneys representing clients within asbestos claims.

Learn how insurance archeology can locate an organization’s old insurance to help pay for legal fees and settlements

By David A. O’Neill, J.D.

Last year, Governor Andrew Cuomo signed the Child Victims Act in New York. One of the provisions of the Act provided victims the ability to file previously time-barred cases for a period of one year. However, due to COVID-19, and the pandemic’s impact on court processes, the Senate and Assembly have extended the victims’ deadline to file claims to August 14, 2021.

Across the nation, sexual abuse claims present both moral and financial challenges to organizations involved in litigation regarding possible misconduct in decades past. The allegations most prominently involve improper behavior by teachers, former staff, priests, and ministers in the 1950’s, ‘60’s and ‘70’s. The alleged victims’ recollections have long laid dormant and often come as a shock to modern day school and church administrators.

In my experience as an insurance archeologist, I have successfully assisted many churches and schools whose present pastors and head masters have found themselves targeted in litigation based on a former church goer’s or a former student’s recollections of sexual abuse. I have also worked to locate historical policies issued to organizations and institutions with a focus on children’s welfare issues.

As an insurance archeologist, we are typically called in after attorneys, insurance brokers, and school officials have been consulted. The attorney has directed his or her client to pull together any historical documents it may have relating to insurance during the years that, according to the complaint, the misconduct occurred. The current insurance broker has been notified of a potential claim and has been asked to identify possible coverage.

If the client is unable to find proof of insurance, the insurance broker advises that current insurance does not cover long-tail claims and it cannot identify the earlier insurance policies, then an insurance archeologist is called in to locate the historical insurance policies.

Sexual misconduct coverage can be found in the general liability policies covering either the entire institution or the particular school or church in which the occurrences took place. Unlike environmental and asbestos exposures that are often ongoing, sexual abuse exposures can be intermittent. Occurrences on separate dates in the same month can trigger coverages under separate policies.

The work of an insurance archeologist is always confidential. Often the investigation is performed at the direction of attorneys defending the church or school, and the report of findings is an attorney work product, considered protected as an attorney-client privileged document.

Usually on my initial meeting with church or school administrators, I find them still in shock about the entire matter. They are young people doing good work with children, the mentally challenged, the elderly and those in need. They are consumed by a legitimate worry for the survival of their particular institution or organization. They often don’t understand why the insurance broker’s records do not go further back in time and have searched their records and could not find their old policies.

There are two main parts to insurance archeology. First, we conduct archival searches and interviews to find leads concerning historic policies, and then we follow up on those leads to identify carriers that issued general liability policies that can provide funding to respond to abuse claims.

While no individual document provides the whole story, a good insurance archeologist knows how to assemble their findings to approximate a skeleton of the historical insurance program. Lastly, in a meeting with the attorney, the insurance archeologist identifies which insurance carrier(s) to place on notice and provides the insurance evidence to attach to the notice of claim.

Insurance archeology can help the school or church administrators find funding for legal fees and settlements to address sexual abuse claims. With the extension of the Child Victims Act until 2021, it’s highly probable that administrators will still receive claims. By taking a proactive approach and working with an insurance archeologist, missing or lost pieces of historical coverage information can be located to provide a full picture of your organization’s historical insurance coverage.

Contact us today to learn about confidential insurance archeology.

---