Construction Defect Disputes and Insurance Claims: Navigating Complex Multi-Party and Multi-Policy Issues

This CLE course will discuss vertical vs. horizontal insurance coverage exhaustion in construction defect disputes. The program will analyze the impact of exhaustion on allocation between the contractor's primary and excess coverage, the priority of payment between the contractor and its subcontractors, and the impact on additional insured coverage. The program will discuss best practices for resolving allocation disputes in construction claims involving multiple parties and layers of coverage.

One of the more complex issues in construction defect disputes involves property damage claims with multiple parties and implicating multiple layers of insurance. These claims often involve the contractor and several subcontractors.

Resolving coverage disputes hinges on understanding the relationship between primary and excess insurers and the point at which coverage from the excess policy is triggered. The outcome of horizontal vs. vertical exhaustion both among primary insurers and between primary and excess carriers is critical.

Exhaustion rules are also critical in determining which policy pays first among different parties--the contractor's primary policy or the policies of the subcontractors. More complex and contentious challenges arise when additional insured coverage is present.

Listen as our authoritative panel of insurance practitioners guides you through principles of vertical and horizontal insurance coverage exhaustion, how it impacts allocation between the contractor's primary and excess coverage, and priority of payment between contractor and subcontractor policies and among additional insureds.