Duty to Defend Exists when Concurrent Insurance Policies Contain Excess Insurance Coverage Clauses
In Public Service Mutual Ins. V. Capitol Transamerica, the insurer, Public Service Mutual (“Public”), issued a policy naming the apartment property owner, Belmont Clark, and the building manager, Kenard, as co-insureds. The insurer, Capitol Transamerica (“Capitol”), also issued a CGL policy and an umbrella policy to Kenard. All three policies covered Kenard’s liability for the underlying litigation. All policies stated that the insurance was excess over any other insurance.
A man fell to his death from the porch of the third-floor apartment owned by Belmont Clark and managed by Kenard. His estate alleged in the underlying wrongful death action that Kenard negligently failed to install guardrails on the porch. Kenard tendered the defense to Public, who then demanded that Capitol contribute to the cost of Kenard’s defense.
The issue was which insurer had a duty to defend the insured in the underlying litigation when two concurrent insurance policies contained excess insurance coverage clauses.
The court held that both policies contained primary coverage for the underlying lawsuit. Thus, both insurers had a duty to defend Kenard and shared the cost of its defense.
Public Service Mutual Ins. Co. v. Capitol Transamerica Corp., 2010 WL 4791692 (N.D.Ill., 2010).
