Interstate Fire & Casualty Co. v. Abernathy
2012 Fla. App. LEXIS 8278
| Fla. Dist. Ct. App. | 2012Background
- Club-sponsored Jellyfish Festival on 4/13–4/14/07 where Dakota Abernathy was injured; at the time, Club had no liability insurance and no written/oral contract with Emerald Coast or Interstate.
- Emerald Coast was insured by Interstate and obtained a COI naming Club as additional insured for operations at the Jellyfish Festival; the COI stated it did not confer rights and did not amend coverage.
- Club requested COI after the accident; Wardlow Insurance Brokers prepared the COI on 4/18/07, which listed specific festival operations and stated it was information only and not altering policy coverage.
- Abernathy settled with the Club for $6.25 million; the Club assigned its rights under the Interstate policy to Abernathy and agreed not to execute the judgment against the Club.
- Trial court initially allowed coverage under the COI; appellate reversal held the COI did not create insurance nor extend coverage for a known loss, and remanded for entry of judgment in favor of Interstate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the COI created insurance coverage for a known post-injury loss | Abernathy: COI operated as coverage for the Club. | Interstate: COI was information-only and not insurance. | COI did not create insurance for a known loss. |
| Whether Wardlow had authority to issue the COI and make it part of the policy | Abernathy relied on broker authority to bind coverage. | Interstate: COI not binding as insurance; issue limited by statements. | COI not an insurance contract; insufficient to bind coverage. |
| Public policy and fortuity known-loss doctrine bar post-injury coverage | Abernathy argues fortuity doctrine not applicable. | Interstate: known loss doctrine forbids insuring a loss known before policy inception. | Public policy precludes coverage for a known loss; remand for judgment for Interstate. |
Key Cases Cited
- Nat’l Union Fire Ins. Co. of Pittsburgh, PA. v. Stroh Cos., Inc., 265 F.3d 97 (2d Cir.2001) (fortuity/known loss principles integral to insurance policy)
- Intermetal Mexicana, S.A. v. Ins. Co. of N. Am., 866 F.2d 71 (3d Cir.1989) (public policy against insuring a certainty)
- Nourachi v. First American Title Insurance Co., 44 So.3d 602 (Fla.5th DCA 2010) (known loss doctrine; disclosure and public policy concerns)
- Perera v. U.S. Fid. & Guar. Co., 35 So.3d 893 (Fla.2010) (Coblentz-style analysis of certificates and insurance)
- Coblentz v. Am. Sur. Co. of N.Y., 416 F.2d 1059 (5th Cir.1969) (certificate of insurance issues; if not true insurance, not coverage)
- Bartholomew v. Appalachian Ins. Co., 655 F.2d 27 (1st Cir.1981) (loss insured against must be contingent; not certain/known)
- Scott C. Turner, Insurance Coverage of Construction Disputes, 2011 () (public policy and fortuity principle in coverage)