American Home Assurance Co. v. International Insurance

Full title:AMERICAN HOME ASSURANCE COMPANY, Appellant, v. INTERNATIONAL INSURANCE…

Court:Appellate Division of the Supreme Court of New York, First Department

Date published: Apr 11, 1996

Fact:

American Home Assurance Company (American), the plaintiff, brought an action against International Insurance Company (International), the defendant, seeking contribution as a co-excess insurance carrier. The underlying case involved a wrongful death action in which a family died due to carbon monoxide poisoning caused by a gas furnace serviced by the insured, Mobile Gas. Mobile Gas had three levels of insurance coverage: primary insurance, first level excess coverage, and second level excess coverage.

Issue:

The main issue on appeal is whether an excess insurance carrier, like International, must allege and demonstrate prejudice when asserting late notice of claim or occurrence as a defense against a claim by a co-excess insurance carrier, like American, suing for contribution.

Decision:

The court concludes that excess insurance carriers, like reinsurers, must allege and demonstrate prejudice when asserting late notice as a defense. The court reverses the lower court’s decision, denies International’s motion for summary judgment based on collateral estoppel, and reinstates American’s complaint.

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