We agree essentially with the views expressed by Judge Conford in his dissenting opinion in the Appellate Division (116 N. J. Super. 88, 98-105 (1971)); accordingly the judgments in favor of The Aetna Casualty and Surety Company and Employers Mutual of Wausau are affirmed and the judgment in favor of Employers’ Surplus Lines Insurance Company is reversed.
We are satisfied that here the plaintiff-assured reasonably expected that the policy issued to it by the Employers’ Surplus Lines Insurance Company would provide coverage against negligence claims relating to its construction of the building where the underlying policies failed to do so. It must be borne in mind that the underlying policies were in substantial amounts and that the policy which the assured sought and obtained from Surplus Lines was intended to operate as and was expressly called an “umbrella policy” by the insurer. Its very nomenclature suggested a purpose to protect against gaps in the underlying policies and indicated more than mere excess coverage.
Cf. Gerhardt v. Continental Ins. Co.,
48
N. J.
291, 295-96 (1966). The policy was undoubtedly ambiguous but under settled principles the ambiguity is to be resolved against the insurer. See
Bauman v. Royal Indem. Co.,
36
N. J.
12, 21 (1961);
Hunt v. Hospital Service Plan of N. J.,
33
N. J.
98, 102 (1960). Despite repeated cautions from the courts, insurers still persist in using obscure terminology which laymen find unfathomable. Cf.
Allen v. Metropolitan Life Ins. Co.,
44
N. J.
294, 302 (1965). While the courts are in no position to dictate the terminology they are in a
For affirmance in part and reversal in part — Chief Justice Weinteattb, and Justices Jacobs, Eearcis, Pkoctoe, Hall and Schettiro—6.
Opposed — Hone.