In May 2014, Nevada became the latest state to interpret the breadth and applicability of the pollution exclusion contained within a third-party general liability policy. Although many states have considered this question, those courts have reached diametrically opposite conclusions, leading to confusion and uncertainly, particularly with respect to states that have yet to address the
New Jersey Appellate Court Rejects Insured’s Attempt to Circumvent the Pollution Exclusion in Asbestos-Related Loss by Using the Vandalism Exception to the Exclusion
When faced with the impending application of an exclusion that negates any coverage for a claimed loss, an insured may sometimes resort to far-fetched or implausible arguments to contend that the exclusion does not apply, or that an exception to the exclusion has the effect of reviving coverage. The insured in Woodcliff Lake Board of …
Insurance Fraud Case: Second Circuit Addresses Adverse Inference Instruction, Restitution For Prior Payments
In insurance fraud cases involving actual or alleged destruction of evidence by the insured, an issue often arises regarding whether an adverse inference instruction is appropriate, and, if so, what form it should take. The Second Circuit recently approved a “light” form of adverse inference instruction that allowed the jury to make an adverse inference…
Insurance Coverage for Chinese Drywall: Virginia Supreme Court Finds Coverage Excluded By Homeowners’ Policies in TravCo Insurance Company v. Ward
CASE RESULTS DEPEND UPON A VARIETY OF FACTORS UNIQUE TO EACH CASE. CASE RESULTS DO NOT GUARANTEE OR PREDICT A SIMILAR RESULT IN ANY FUTURE CASE UNDERTAKEN BY THE LAWYER.
Today the Virginia Supreme Court, in answering a certified question from the federal Fourth Circuit, held unanimously that a homeowners’ insurance policy did not provide coverage for a loss caused by Chinese-made drywall. In TravCo Insurance Company v. Ward, Record No. 120347, slip op. (Va. Nov. 1, 2012), the court was asked to interpret exclusions for loss caused by: (1) latent defect; (2) faulty, inadequate, or defective materials; (3) rust or other corrosion; and (4) pollutants, defined to include any gaseous irritant or contaminant. The court held that “each of the four exclusions is unambiguous and reasonable in its form, scope and application and excludes damage resulting from the Chinese drywall from coverage.” Id. at 4. Here are a few quotes from the opinion:…
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Pollution Exclusion in Property Insurance Policies: Virginia Supreme Court Rules That Typical Pollution Exclusion Provisions In First Party Policies Are Not Limited To “Traditional” Environmental Pollution.
While the pollution exclusion has generated extensive litigation under liability insurance policies, few property insurance cases address it. In what appears to be the first state supreme court decision on the pollution exclusion in a property policy, the Virginia Supreme Court has upheld the exclusion as unambiguous.