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The Connecticut Supreme Court has unanimously affirmed a state appeals court ruling in a complex insurance coverage dispute over alleged asbestos-related claims arising out of industrial talc use and product.
The court held in a ruling that will be officially released Tuesday that a policyholder who previously bought occurrence-based coverage should not be deemed uninsured for long-tail liability claims during years when only limited claims-made liability coverage was available.
R.T. Vanderbilt Co. Inc. v. Hartford Accident and Indemnity Co. et al. involved a Norwalk, Connecticut-based chemical manufacturer in a coverage dispute against more than 20 general liability and umbrella and excess liability insurers who had insured Vanderbilt over a 60-yearr period dating back to 1948.
Vanderbilt has faced numerous lawsuits through the United States alleging the talc it mined and sold until 2008, when it stopped production and sold of the last of its inventory, contained asbestos and caused asbestos-related diseases in workers and others exposed to the talc.
Vanderbilt, which has held its talc does not contain asbestos, sued its liability insurers, alleging that some were refusing to pay their share of cost and seeking a declaratory judgment on other coverage issues.
Among other issues, the appeals court ruling had upheld the trial court’s application of a “continuous trigger” for coverage, under which every insurance policy in effect from the date a claimant is first exposed to asbestos, until the date when it manifests an asbestos-related disease, is on the risk for defense and liability costs.
It also held Vanderbilt should not be liable for costs allocated to periods after the 1985 liability crisis, when insurers pulled out of the market and general liability coverage was unavailable to the company.
Another issue was whether the appellate court was correct in precluding expert testimony on current medical science regarding the actual timing of bodily injury from asbestos-related diseases.
“After carefully examining the record on appeal and considering the briefs and arguments of the parties, we have concluded that the judge of the Appellate Court should be affirmed with respect to these issues,” says the ruling.
“The Appellate Court’s thorough and well-reasoned opinion more than sufficiently addresses these certified questions,” it said.
The appellate court had also held, in a precedent-setting victory for the insurers in the case, that occupational disease exclusions cover workers at firms using a policyholder’s products in addition to the policyholders’ own employees.
To “read the exclusion as argued by Vanderbilt would require us to add otherwise nonexistent language specifically limiting their application to Vanderbilt’s employees, which is contrary to how we interpret contracts, including insurance policies,” the ruling states.
Commenting on the ruling, Vanderbilt attorney Stephen Hoke, of Chicago-based Hoke LLC, said in addition to being significant to Vanderbilt, the ruling is “generally significant because it establishes for the first time in Connecticut law some of the most important insurance issues”’ that impact mass torts and long-tail claims, such as those associated with asbestos, talc and pollution.
An insurers’ attorney could not be reached for comment.
An Illinois appeals court has overturned a lower court ruling case and held that units of CNA Financial Corp. and Allstate Insurance Co. must view asbestos-related claims against an automobile parts manufacturer as separate, based on location, rather than as one claim for coverage purposes.