952 N.E.2d 254
Ind. Ct. App.2011Background
- Anthem's reinsurance program followed form to its primary policy through multiple excess layers and certificates, all effective Sept 30, 1999 to Sept 30, 2002.
- The primary and excess policies are claims-made, with coverage for claims first made during the policy period and reported as required.
- The Collins complaint in Connecticut (1999) alleged improper reimbursement by Anthem; Anthem reported Collins to its reinsurer, National Union.
- Reliance Insurance was an initial excess reinsurer but went bankrupt; Twin City replaced Reliance as excess reinsurer beginning July 15, 2000.
- Beginning in 2001, Anthem faced more than ten additional lawsuits alleging improper denial of reimbursement, many consolidated in MDL in Florida.
- Anthem sought defense and indemnification from its reinsurers for some post-2000 claims; Twin City moved for summary judgment claiming no coverage due to relation back to Collins.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Section 6 bar coverage for post-2000 claims? | Twin City contends Collins predated its policy and related post-2000 claims to Collins to limit coverage. | Twin City argues Section 6 excludes retaliation of claims based on same acts and limits liability, retroactively excluding post-2000 claims. | Section 6 does not operate to exclude post-2000 claims. |
| Does Section 8 preclude coverage for post-2000 claims? | Twin City asserts prior notice excludes later claims by relation back to Collins. | Anthem argues Section 8(b) is prospective and cannot retroactively preclude coverage for later claims. | Section 8 does not exclude coverage for post-2000 claims. |
| Can notice given under primary policy trigger Section 8(b) for Twin City's policy? | Notice of Collins to National Union should backdate coverage under Twin City. | Twin City cannot treat Collins as reported to it since its policy was not in effect at that time. | No relation-back effect; Twin City coverage not excluded by notice under Section 8. |
Key Cases Cited
- ACE Am. Ins. Co. v. Ascend One Corp., 570 F.Supp.2d 789 (D. Md. 2008) (retrospective exclusions not present where policy language lacks express retroactivity)
- Cox Commc'ns, Inc. v. Nat'l Union Fire Ins., 708 F.Supp.2d 1322 (N.D. Ga. 2010) (premature reporting cannot backdate coverage to a policy not in effect)
- Cont'l Cas. Co. v. Wendt, 205 F.3d 1258 (11th Cir. 2000) (limitations on consecutive policies; aggregation concept)
- FDIC v. Booth, 82 F.3d 670 (5th Cir. 1996) (claims-made notices extend coverage for related wrongful acts)
- Fin. Mgmt. Advisors, LLC v. Am. Int'l Specialty, 506 F.3d 922 (9th Cir. 2007) (prior-notice exclusions and related policy language considerations)