T-Mobile USA Inc. v. Selective Ins. Co. of America
908 F.3d 581
9th Cir.2018Background
- T-Mobile USA (Seattle) sued Selective Insurance after Selective denied coverage as an additional insured under a policy issued to Innovative, a contractor that had a contract requiring Innovative to add T-Mobile NE as an additional insured.
- Selective delegated authority to broker Van Dyk Group (VDG) to issue binders, policies, and certificates; VDG issued a 2012 Certificate of Insurance (COI) stating T-Mobile USA "is included as an additional insured."
- The COI also contained bold disclaimer language stating the COI "confers no rights" and "does not amend, extend or alter" the policy and warned that endorsements are required to confer additional-insured status.
- Selective defended Innovative under a reservation of rights, denied coverage to T-Mobile USA, and stated T-Mobile did not appear as an insured on the policy.
- The district court granted summary judgment for Selective, dismissing T-Mobile USA's breach, declaratory judgment, bad-faith, and related claims; Ninth Circuit certified to the Washington Supreme Court the question whether an insurer is bound by representations in a COI made by its authorized agent when the COI disclaims authority to expand coverage.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an insurer is bound by its authorized agent's representation in a COI that a party is an additional insured when the COI disclaims altering coverage | COI issued by insurer's authorized agent (VDG) binds Selective; agency rule makes insurer liable for agent's representations | COI cannot alter policy terms; disclaimer and Washington precedent bar COIs from conferring coverage | Question certified to Washington Supreme Court for authoritative state-law answer; Ninth Circuit stayed proceedings |
Key Cases Cited
- Chicago Title Ins. Co. v. Wash. State Office of Ins. Comm’r, 309 P.3d 372 (Wash. 2013) (insurer bound by acts/representations of its agent within scope of authority)
- Postlewait Constr., Inc. v. Great Am. Ins. Cos., 720 P.2d 805 (Wash. 1986) (COI issued to inform recipient that insurance exists; COIs do not alter policy coverage)
- Int’l Marine Underwriters v. ABCD Marine, LLC, 267 P.3d 479 (Wash. Ct. App. 2011) (COIs cannot amend, extend, or alter policy coverage)
- Lehman Bros. v. Schein, 416 U.S. 386 (U.S. 1974) (federal courts may certify state-law questions to state supreme courts)