CM Report Focus on Property Insurance (2005v1)
2005 Spring
CM Property Insurance
Articles in this report
A Comparison of the Interpretation of All Risk Insurance Policies: The United States v. England & Wales
The first step in the analysis of any coverage issue requires that the insurance policy must be consulted. The second step in the analysis of any coverage issue requires that the common law must be reviewed and considered in light of the terms of the insurance policy. The following is a broad and general overview of some principles that courts in the United States and in England and Wales follow when resolving coverage questions presented by all risk insurance policies. An associate in our Chicago office, Mindy M. Medley, has addressed the law that has been developed by courts in the United States, and a solicitor in our London office, Darren O. Thompson, has addressed the law that has been developed by courts in England and Wales.
The papers within this brochure discuss only a small sample of the complexities involved in the interpretation of an insurance policy in both the United States and England, primarily in the context of one specific publicized litigation topic - mold. We recognize that there is a competitive insurance market looking for certitude in policy language that is demonstrated by uniform interpretation by the courts. We also understand that this insurance market seeks to satisfy the multi-national insured with a master policy that works effectively across borders. The pressure on brokers and underwriters alike is to provide a simplified broad coverage within a single document that satisfies the particular insurance needs of an individual insured.
The Current State of the Ensuing Loss Provision in the Context of Mold Claims
All risk insurance policies often contain “ensuing loss” provisions. A typical ensuing loss provision provides coverage for loss or damage that is not otherwise excluded, and results or ensues from an excluded cause of loss. For example, insurance policies are often written to exclude coverage for loss or damage caused by faulty workmanship, but provide coverage for loss or damage that ensues from that faulty workmanship. See, e.g., Prudential Property & Casualty Co. v. Lillard-Roberts, No. CV-01-1362-ST, 2002 U.S.Dist. LEXIS 20384 (D.Ore. June 14, 2002).
