Alaska Interstate Construction, LLC v. Crum & Forster Specialty Insurance Co.
696 F. App'x 304
| 9th Cir. | 2017Background
- AIC held consecutive claims-made E&O policies from C&F: initial policy (Dec 1, 2011–May 1, 2013) and a renewal (May 1, 2013–May 1, 2014).
- VC Sellers Reserve, LLC made a claim against AIC on January 10, 2013 (during the initial policy period).
- AIC did not report that claim to C&F until June 19, 2013 (during the renewal policy period).
- The policies defined “policy period” as “the period shown in the Declarations” and limited coverage to claims made and reported during the same policy period.
- C&F denied coverage; district court granted summary judgment for C&F. AIC appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a claims-made policy’s “policy period” can be read to include consecutive initial and renewal periods as a single continuous period | "Policy period" as defined by reference to the Declarations is not limited to one policy and can reasonably be read to cover both consecutive policy terms, so the claim was made and reported within a single continuous period | The policy language requires a claim to be both made and reported within the same policy period as shown in a particular policy’s Declarations; the claim was made in one period and reported in another, so coverage does not apply | Court held the plain language requires making and reporting within the same policy period; AIC’s reading was unreasonable and coverage was not triggered |
| Whether AIC receives the policy’s automatic 90-day extended reporting period (ERP) after the initial period ended because the policy period ended | If each policy period is treated independently, the initial policy effectively ended (was "canceled"), triggering the automatic 90-day ERP so the late report would be covered | The ERP is triggered only by explicit cancellation or non-renewal by the insurer; because AIC renewed the policy, ERP did not apply | Court held ERP did not apply because renewal, not cancellation or insurer non-renewal, occurred |
Key Cases Cited
- State Farm Mut. Auto. Ins. Co. v. Dowdy, 192 P.3d 994 (Alaska 2008) (ambiguities in insurance policies construed to honor lay insured's reasonable expectations)
- Cast Steel Prods., Inc. v. Admiral Ins. Co., 348 F.3d 1298 (11th Cir. 2003) (construction favoring continuity across renewal — cited by AIC but considered distinguishable)
- Helberg v. Nat'l Union Fire Ins. Co., 657 N.E.2d 832 (Ohio Ct. App. 1995) (similar minority view supporting coverage across renewal)
- Checkrite Ltd., Inc. v. Ill. Nat'l Ins. Co., 95 F. Supp. 2d 180 (S.D.N.Y. 2000) (majority rule that renewal does not extend reporting period for prior-period claims)
- GS2 Eng'g & Envtl. Consultants, Inc. v. Zurich Am. Ins. Co., 956 F. Supp. 2d 686 (D.S.C. 2013) (criticizing the minority approach and emphasizing policy language analysis)
AFFIRMED.