Horizontal vs. Vertical Exhaustion of Insurance: Priority of Coverage and Settlement for Below Policy Limits
Course Details
- smart_display Format
On-Demand
- signal_cellular_alt Difficulty Level
Intermediate
- work Practice Area
Insurance
- event Date
Tuesday, February 27, 2024
- schedule Time
1:00 p.m. ET./10:00 a.m. PT
- timer Program Length
90 minutes
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This 90-minute webinar is eligible in most states for 1.5 CLE credits.
This CLE course will provide insurance counsel with a review of essential issues in horizontal and vertical exhaustion, the interrelationship between the primary carrier's obligation and those of the excess insurer, and best practices to resolve coverage priority disputes.
Mr. Seaman is a commercial litigator and trial lawyer with more than 35 years of experience. Scott is widely regarded as one of the leading attorneys in the United States representing insurers and reinsurers in property and casualty matters. He is known for employing his deep knowledge of the law and insurance industry, strategic thinking, and honed trial and appellate advocacy to produce creative solutions and outstanding results for clients. Clients regularly turn to Scott and his team for counsel and representation in challenging and high-stakes insurance and business matters. Mr. Seaman has a long track record of successfully representing companies before trial courts, appellate courts, and arbitration panels across the country in a variety of cases and matters involving general liability coverage (primary, umbrella, and excess), professional liability coverage, directors and officers liability insurance, first-party property coverage, bad faith and extra-contractual matters, fee disputes, and facultative and treaty reinsurance contracts. He also advises and represents companies on cyber, privacy, data breach, IoT, nanotechnology, gig economy, viruses and pandemics, representations and warranties, transactional insurance, social unrest, ESG, climate change, and other emerging issues, as well as a wide-range of case-specific and portfolio issues. He also has handled a variety of challenging international, professional liability, health/life science, director and officer liability, tort and product liability, and business and commercial cases.
He was named to the inaugural list of Midwest Trailblazers by The American Lawyer magazine for his "high-profile, complex insurance coverage cases nationwide, which resulted in precedent setting rulings that have altered insurance law." He is co-author of Allocation of Losses in Complex Insurance Coverage Claims (11th Ed. 2023) He is ranked Band I by Chambers USA.
Mr. Hermanson represents primary and excess insurance carriers in high-exposure litigation on contested coverage matters. Over a 30-year career, he has litigated more than two hundred cases, and successfully advised on hundreds more, in almost every U.S. state and the District of Columbia. Mr. Hermanson serves as Chair of the ABA Tort Trial and Insurance Practice Section (TIPS), Self-Insurers and Risk Management Committee; Vice-Chair of the ABA TIPS Insurance Coverage Litigation Committee; and past chair of the Boston Bar Association (BBA) Insurance Law Subcommittee. In 2019 he was elected to the American College of Coverage Counsel.
Ms. Perry has a wealth of experience in contract reviews, insurance program evaluations, and coverage analysis.
Insurance counsel face challenging issues in accessing excess coverage when multiple policies, issued to a single insured, provide coverage to a single claim.
Sometimes issues arise when a loss extends over several years and several sequential policies. In this case, questions may arise as to whether the primary coverage exhausts horizontally or vertically: in other words, whether the insured has to exhaust one primary policy or all primary policies before excess coverage becomes available.
Sometimes issues arise when the insured settles a claim with its primary carrier for less than the policy limits. Tapping the excess policies in these situations requires close attention to the policies' language and the rapidly evolving law in this area.
Resolving these insurance coverage disputes hinges on understanding the policy language, the contracts between the parties, and the relationship between the primary and excess insurers who may be called on to respond to the loss.
Listen as our authoritative panel of insurance attorneys discusses vertical and horizontal insurance coverage principles, triggering excess policies, and resolving issues with the excess carrier when the primary carrier settles for less than the policy limits
- Overview of horizontal and vertical insurance coverage in the additional insured context
- The priority of coverage between the primary carrier and excess insurer and the triggering of excess insurance
- The dichotomy of views among states and recent case law
- Strategies for resolving issues when the primary carrier settles for less than the policy limits
The panel will review these and other vital issues:
- When additional insured coverage involves both primary and excess policies, what are the best strategies for resolving vertical vs. horizontal exhaustion?
- How can counsel resolve issues that arise between the insured, the excess carrier, and primary carrier when the primary carrier settles for less than the policy limits?
- How do you identify potentially problematic policy language when triggering excess insurance for continuous injury claims?
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