Duty to Defend Decision in the LA Supreme Court

On Behalf of | Mar 10, 2017 | Insurance Law

THE LOUISIANA SUPREME COURT RECENTLY HELD THAT THE DUTY TO DEFEND IN LONG LEGACY DISEASE CASES SHOULD BE PRORATED BETWEEN THE INSURANCE COMPANY AND THE INSURED IN SITUATIONS WHERE AN OCCURRENCE-BASED POLICY PROVIDED COVERAGE FOR ONLY A PORTION OF THE TIME FOR WHICH THE EXPOSURE OCCURRED.

In Arceneaux, et al. v. Amstar Corp, et al., 200 So.3d 277, 2015-0588 (La 9/7/16), 2016 WL 4699163. (La. 2016), the Louisiana Supreme Court allocated the costs of defending long-legacy disease claims between the insurer and insured based on a time-on-the-risk allocation model. Under existing Louisiana law, an insurers duty to indemnify was to be prorated among insurance carriers based upon a time-on-the-risk approach among the insurance carriers that were on the risk during periods of exposure to the injurious conditions. While the law in Louisiana was settled regarding time on the risk pro rata allocation applying to indemnification, there was no Louisiana precedent on whether the insurer’s duty to defend could also be pro rated among the insurers and the insured during

Categories

Archives