Tag archives: Exclusions

Russian roulette is self-inflicted injury not suicide (US)

By Patrick Bracher (ZA) on October 8, 2019 Posted in Insurance

A Texas court held that the insurers did not have to pay the death claim for a teenager who died when he pulled the trigger of a revolver with the barrel in his mouth and one bullet in the cylinder killed him instantly, because it was excluded by the policy exclusion for death caused directly … Continue reading

A rare contribution case, and the pollution exclusion (US)

By Patrick Bracher (ZA) on July 30, 2019 Posted in Insurance

After the Zurich American Insurance Co (ZAIC) in Missouri, USA paid out a claim on wrongful death from asbestos exposure, it sought a contribution from Insurance Company of North America (INA). The claim for contribution failed because the INA policy had a pollution exclusion but the principles of contribution between insurers were discussed. The facts … Continue reading

War exclusion requires hostilities between sovereign states (US)

By Patrick Bracher (ZA) on July 23, 2019 Posted in Insurance

A Californian court of appeals found that war exclusions which exclude coverage for expenses resulting from “war” or “warlike action by a military force” require hostilities between de jure or de facto governments (governments or entities essentially like governments). The insured was a film company producing a television series in Jerusalem when Hamas fired rockets … Continue reading

Bin with wheels is not a ‘vehicle’ (US)

By Patrick Bracher (ZA) on July 16, 2019 Posted in Insurance

A New York Appeals Court unsurprisingly found that a recycling bin with wheels, which ruptured a gas line used by residents of an apartment building, is not a ‘vehicle’. An all risks policy exclusion did not apply if there was ‘direct loss causing physical damage to covered property from vehicles’. The court said that not … Continue reading

Cyber insurance and the war exclusion

By Patrick Bracher (ZA) on July 16, 2019 Posted in Insurance

Cyber insurers should note the debate going on in London regarding reform of the war exclusion clause in cyber insurance. The perpetrators of cyber incidents are often untraceable and it is difficult to ascertain whether they constitute state-sponsored acts of war subject to the war exclusion clause. There is at least one pending action where … Continue reading

No claim for blowtorch-damaged jewellery: care, custody or control exclusion (US)

By Patrick Bracher (ZA) on July 10, 2019 Posted in Insurance

A New Jersey appeals court refused to grant cover for a loss of $4 million worth of opals ruined inside a safe that had to be opened with a blowtorch. The claim was made against the company that sold the safe and were involved in the day long effort to get the safe opened when it … Continue reading

Evidence of sudden and accidental pollution rejected (US)

By Patrick Bracher (ZA) on July 3, 2019 Posted in Insurance

A corporation which operated two industrial sites found significant amounts of ground water contamination. Its attempt to get insurance cover on the basis that the pollution was sudden and accidental was unsuccessful because the evidence of its expert was rejected as not being based on sound methodology. The pollution exclusion therefore defeated the claim. On … Continue reading

Exclusion of liability in carriage document for deck cargo

By Patrick Bracher (ZA) on June 9, 2019 Posted in General

Where a bill of lading provided that ‘the carrier shall in no case be responsible for loss of or damage to the cargo, howsoever arising … in respect of deck cargo’ the English High Court held that the provision effectively excluded liability for deck cargo which was lost overboard from the vessel in heavy seas. … Continue reading

Contractual claim not covered under liability policy (US)

By Patrick Bracher (ZA) on April 4, 2019 Posted in Insurance

Where the purchaser of an oil refinery sued the seller for breach of contract for $25 million damages resulting from a fire caused by various acts and omissions of the seller prior to the sale, the claim was not covered under the seller’s commercial general liability policy. The claim was not based on property damage but … Continue reading

Power station damaged by shocked squirrel is excluded

By Patrick Bracher (ZA) on February 6, 2019 Posted in Insurance

Where a squirrel found its way onto a power station’s electrical transformer triggering an electrical arc that killed the squirrel and caused damage to the municipality’s property of $213 524, the court denied the municipality all-risks insurance cover because of an exclusion for ‘loss caused by arcing or by electrical currents other than lightning’. The court … Continue reading

Definition of ‘explosion’ cover in breakdown policy excludes liability

By Patrick Bracher (ZA) on December 2, 2018 Posted in Insurance

A refining company claimed under its equipment breakdown insurance policy following an explosion that occurred when a segment of a pipe in a charge heater designed to refine the petroleum product naphtha burst. A 600 degree naphtha mixture was running through the pipe at more than 14 000 pounds per hour and, when the charge heater … Continue reading

Enforceability of the sanctions exception in policies (UK)

By Patrick Bracher (ZA) on November 25, 2018 Posted in Insurance

An awaited decision on the enforceability of the sanctions provision in policies of insurance heard in the UK courts has turned out to be of not much general assistance. The English High Court found that, although an insurer is not liable to pay a claim where the payment would be prohibited under EU or US … Continue reading

Insurer entitled to rely on third party expert’s conclusions (US)

By Patrick Bracher (ZA) on November 4, 2018 Posted in Insurance

A Delaware court held that a property insurer did not breach its policy issued to a farm when it refused to cover the collapse of a chicken coop during a blizzard because it justifiably relied on expert reports indicating that the destruction was caused by snow and faulty construction which were exclusions under the policy. … Continue reading

Strip club not covered for credit card theft by employees (US)

By Sandra Sithole (ZA) on September 6, 2018 Posted in Insurance

In August 2018, a US federal court ruled that an insurer did not have to cover a strip club for third party reimbursement costs arising from credit card fraud on its customers by the club’s employees because no direct loss was suffered by the club itself. The insured, a club owner, was the holder of … Continue reading

Damage arising from marijuana operations not covered by policy (US)

By Sandra Sithole (ZA) on September 3, 2018 Posted in Insurance

A US appeals court in August 2018 found that an insurer does not have to indemnify its insured for damage to a warehouse by tenants who converted it into a marijuana growing operation, finding that an exclusion in the policy for losses resulting from criminal acts precluded cover. The claim arose under the building and … Continue reading

Wrongful death claims at bar fails on assault exclusion (US)

By Sandra Sithole (ZA) on August 6, 2018 Posted in Insurance

Two US district courts in two separate cases held in July 2018 that the insurers of public bars do not have a duty to defend or indemnify the insured owners of the bars for violent deaths of patrons because of the policy exclusion for bodily injury arising from an assault, battery or physical altercation. The … Continue reading

Carbon monoxide death liability claim fails on pollution exclusion (US)

By Yash Naidoo on July 24, 2018 Posted in Insurance

Two tenants of a second-floor unit in an apartment building (condominium) in Florida USA died in their bedroom, after inhaling carbon monoxide gas whilst asleep. The gas was believed to have come from a car in the unit’s garage. It seeped into the air-conditioning system of the unit and entered the bedroom through the system’s … Continue reading

Disintegrating foundations caused by flowing water is gradual deterioration

By Patrick Bracher (ZA) on July 10, 2018 Posted in Insurance

A policy exclusion for damage caused by ‘gradual deterioration’ was held to exclude cover where a building had to be demolished by reason of foundations which disintegrated from flowing water. The building was built across a line of an old watercourse with seven natural springs in the vicinity and there was no proper drainage design. … Continue reading

Action over stolen trade secrets does not fall under defamation cover (US)

By Patrick Bracher (ZA) on June 20, 2018 Posted in Insurance

A US company was sued for misappropriating trade secrets relating to a medical device and poaching a number of employees. The company was insured in terms of an advertising and personal injury section of its commercial general liability policy, and it attempted to allege that there was a claim for implicit defamation obliging the insurers … Continue reading

Asbestos exclusion upheld in US

By Patrick Bracher (ZA) on June 19, 2018 Posted in Insurance

An exclusion for claims ‘arising out of asbestos’ was upheld by the US Third Circuit because it is unambiguous and therefore enforceable. The Appeal Court overturned a $36 million judgment against the insurer, which is only part of the policyholder’s liability for $120 million worth of asbestos-related claims. The court did not accept the argument that the … Continue reading

Exclusion of loss arising from arrest, restraint, detainment

By Patrick Bracher (ZA) on June 4, 2018 Posted in Insurance

The UK Supreme Court examined the question whether a vessel detained in Venezuela as a result of being used by a drug cartel to smuggle cocaine strapped to the hull fell within the exclusion for ‘arrest, restraint, detainment, confiscation or expropriation … by reason of infringement of any customs … regulations’. The owners of the … Continue reading

Application of insolvency exclusion (UK)

By Patrick Bracher (ZA) on May 22, 2018 Posted in Insurance

Where a professional indemnity policy excluded claims ‘arising out of or related directly or indirectly to the insolvency of the insured’ the court absolved the insurer from liability in a claim by a financial management company that had lost money on a £200 000 investment when the issuer of a bond went insolvent. The court held … Continue reading

‘Arising out of or in connection with’ use of land in liability insurance exclusion

By Patrick Bracher (ZA) on April 23, 2018 Posted in Insurance

A New Zealand couple owned a farm in which they carried out farming activities and a landscaping business. They built and burned a fire heap on the property. Strong winds spread the embers and the fire spread rapidly onto nearby properties causing extensive damage. Their insurance policy excluded ‘legal liability arising out of or in … Continue reading

No cover for racing school accident even though exclusion not read by insured (US)

By Patrick Bracher (ZA) on March 14, 2018 Posted in Insurance

Where a motor policy excluded coverage ‘for any vehicle located inside a racing facility for the purpose of … or participating in any driving school, driver training or skills training’ the court refused the insured an indemnity to cover a crash at a motor racecourse skills-training event. The insured crashed while he was instructing a … Continue reading