CONSTRUCTION DEFECT JOURNAL

"News and Information for Construction Defect and Claims Professionals"

CONSTRUCTION DEFECT JOURNAL - ISSUE 242749 - TUESDAY, NOVEMBER 5, 2024

California Supreme Court Finds Vertical Exhaustion Applies to First-Level Excess Policies

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By 2004, more than 24,000 claimants had filed product liability claims against Kaiser alleging that they had suffered bodily injury as a result of exposure to Kaiser's asbestos products.

August 26, 2024
Tred R. Eyerly - Insurance Law Hawaii

Addressing issues left open in its seminal decision in Montrose, the California Supreme Court found that the language in the first-level excess policies meant that the insured could access the policies upon exhaustion of the directly underlying policies purchased for the same policy period. Truck Ins. Exchange v. Kaiser Cement & Gypsum Corp., 2024 Cal. LEXIS 3271 (Cal. June 17, 2024).

From 1944 through the 1970's, Kaiser manufactured asbestos-containing products at numerous different facilities. By 2004, more than 24,000 claimants had filed product liability claims against Kaiser alleging that they had suffered bodily injury as a result of exposure to Kaiser's asbestos products. Kaiser tendered these claims to Truck, one of several primary insurers that had issued CGL policies to Kaiser.

In 2001, Truck initiated this coverage action to determine its indemnity and defense obligations to Kaiser. Truck later amended its complaint to add a cause of action for contribution against several of Kaiser's excess insurers. The issue presently before the court was whether Truck was entitled to contribution from various coinsurers that issued first-level excess policies to Kaiser during the period in question.

Mr. Eyerly may be contacted at te@hawaiilawyer.com


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