Insurance coverage

New York Insurance Coverage Law Update – March 2022 | Rivkin Radler LLP

The Fourth Department keeps the landlord covered as an additional insured under the tenant’s policy for an accident in the driveway of the rental premises

Technology Insurance Company, as a landlord’s liability insurer, filed an action for declaratory judgment against Main Street America Assurance Company, as a landlord’s tenant’s liability insurer, seeking a declaration that Main Street had the obligation to defend and indemnify the landlord as an additional insured in an underlying personal injury action brought by a customer of the leased premises, a hair salon. In the underlying action, the client alleged that he tripped and fell into a snow-covered hole in the driveway of the premises on his way from the hair salon to his vehicle. The New York Supreme Court, Appellate Division, Fourth Department, ruled that the landlord was entitled to defense and indemnity under the tenant’s policy, which provided additional insured coverage to the landlord for “liability arising of the ownership, maintenance or use of that part of the premises leased to the “tenant”. The court pointed out that the driveway was “necessarily used for entering and exiting” the hair salon and, therefore, was “included within the perimeter of the leased premises”. The court also rejected Main Street’s argument that its policy is “excess” over other insurance that insures “direct physical loss or damage”. The court found that this “other insurance” provision referred to property damage claims, not bodily injury claims like the ones at issue. [Technology Ins. Co., Inc. v. Main St. Am. Assur. Co., 2022 N.Y. App. Div. LEXIS 774 (4th Dep’t Feb. 4, 2022).]

The court concludes that the accident is not covered by the automobile policy because it is not related to the unloading of the vehicle

Wesco Insurance Company filed a declaratory judgment action seeking a declaration that it had no obligation to defend or indemnify various defendants in an underlying personal injury action brought by Manuel Velasquez who was allegedly injured while he was transporting a window panel from his truck to a construction site when he stumbled on a piece of uneven, rutted, hollowed out, rocky and unstable terrain. The court found that the accident did not result from the ownership, maintenance or use of the truck as necessary to trigger Wesco’s motor policy. The court recognized that the “use” of a vehicle under an automobile insurance policy may include “not only the immediate transfer of goods to or from the vehicle, but the ‘complete operation’ of transportation goods between the vehicle and the place from or to whom they are delivered. However, based on the plaintiff’s allegations and testimony, the court determined that the accident was related to the condition of the construction site and not to negligence incidental to the unloading process. [Wesco Ins. Co. v. James River Ins. Co., 2022 N.Y. Misc. LEXIS 347 (Sup. Ct. N.Y. Cnty Jan. 3, 2022).]

District Court Rules Putative Third-Party Additional Insured Complaint and Cross-Defendants’ Claims Against Named Insured Did Not Trigger Additional Insured Coverage

A plaintiff sued Old Slip Property, LLC for injuries she suffered when a pane of glass broke loose and fell on her while she was cleaning a revolving glass door on the 15th floor of a building owned to Old Slip (owner). The owner brought a warranty claim against the claimant’s employer, PBM, alleging that PBM negligently caused the accident. The landlord also filed a warranty claim against the 15th floor tenant, who counterclaimed PBM. Both the landlord and tenant requested additional insured coverage under PBM’s policy, which covered them as additional insureds for liability “caused, in whole or in part, by” the “acts or omissions.” of PBM. They argued that the tenant’s cross-claims and the landlord’s third party claim against PBM triggered a duty to defend because they allege that PBM negligently caused the accident to this plaintiff who failed to seek the defects or has cleaned the door in an unsafe manner. The United States District Court for the Southern District of New York noted that “[i]It is true that “a duty to defend has been based upon … allegations in third party claims alleging negligence and seeking indemnity and contribution from the named insured”. to defend because when “peel[ed] back”, the “pleadings simply show that PBM, at most, ‘simply provided the opportunity for the injury’. [LM Ins. Corp. v. Fed. Ins. Co., 2022 U.S. Dist. LEXIS 27120 (S.D.N.Y. Feb 15, 2022).]