MCS-90 Endorsement: Purpose, Application, and Avoiding Strategic Missteps When Coverage Defenses Are Present

This CLE webinar will discuss the purpose and application of MCS-90 endorsements and the four primary approaches courts take to determine when the MCS-90 endorsement applies. The panel will also examine how and why the endorsement provides settlement leverage for plaintiffs.

Federal motor carriers must prove they have the financial ability to cover damage to the public, and one avenue is the MCS-90 endorsement added to the trucking liability policy. The MCS-90 is not a true insurance policy, because if the insurance company pays a claim, it can theoretically recoup its losses against the policyholder through subrogation. Failure to understand the practical ramifications of this arrangement can be costly.

Before Prime Ins. Co. v. Wright, 57 F. 4th 597 (7th Cir. 2023), there were three different approaches to determining when the MCS-90 endorsement applied. Now there arguably are four, plus the approaches of state supreme courts. Insurers that issued policies with the MCS-90 endorsements face more uncertainty than ever about if and when their financial responsibility is triggered depending on the location of a motor vehicle collision.

The rules for when coverage exists, and when insurers should invoke coverage defenses, are all different under the MCS-90. Experienced plaintiffs' counsel can leverage missteps of the uninformed to increase claim value and put insurers on the road to bad faith allegations and even punitive damages.

Listen as our premiere panel discusses what counsel representing trucking companies or plaintiffs need to know about when the MCS-90 is applicable, and thus, when financial obligations must be met or may be accessed.