As the Fifth Circuit reminded us in a December 21 de
cision, primary insurers can find themselves in excess insurers’ shoes if they reject settlement demands within their policy limits. In American Guaranty & Liability Insurance Co. v. ACE American Insurance Co., the Fifth Circuit upheld a lower court ruling requiring a primary insurer
Equitable Subrogation: A Useful Tool for Your Excess Insurer When Your Primary Insurer Refuses to Settle Within its Limits
Every policyholder will likely face a scenario where its primary insurer refuses a settlement offer within limits. The primary insurer is potentially liable for that excess verdict if it acted in bad faith by refusing to settle within limits. Sometimes, a primary insurer will roll the dice because the policyholder procured excess liability coverage that
Notifying Your Excess Insurers: Don’t Let an Insurer Gamble with Your Company’s Bottom Line
Informed insureds know the importance of notifying their primary insurer of an occurrence or a claim. But notice to the primary layer often does not suffice. If the plaintiff’s demand exceeds the limits in the primary insurance policy, an insured should notify the umbrella or excess insurer (and possibly further up the tower than just