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Insurance Coverage Update April 2013
NEW JERSEY                                                                                             

Priority of Coverage - Automobile Policies
Commercial Auto Insurer Does Not Owe Primary Coverage as Insured did not "Hire" Owner of Vehicle Involved in Accident   Nat'l Interstate Ins. Co. v. Champion Truck Lines, Inc., 2013 U.S. Dist. LEXIS 39795 (D.N.J. Mar. 21, 2013)   In this dispute over which insurer provides primary coverage for a tractor/trailer accident, the District of New Jersey finds that the insured trucker did not "hire" the vehicle in question and therefore, that trucker's commercial automobile policy provided excess coverage.

NEW YORK

Bad Faith -- Discovery
Court Finds Policyholder is Entitled to Documents in Claim that Insurer Intentionally Delayed Paying Attorneys' Fees   Estee Lauder Inc. v One Beacon Ins. Group, LLC, 2013 N.Y. Misc. LEXIS 1550 (N.Y. Sup. Ct. Apr. 12, 2013) Estee Lauder sought defense and indemnity for two underlying claims alleging it dumped hazardous material at two landfills. It filed a declaratory judgment action against its insurer, who denied coverage based on late notice. The trial judge dismissed the complaint, finding the insurer timely disclaimed coverage based on untimely notice. The Appellate Division reversed, holding that the insured Estee Lauder entitled to "all post tender reasonable fees and expenses necessarily incurred in defense of [the second underlying claim], plus prejudgment interest accruing from the date of [the insurer's] repudiation of its duty to defend."


Jurisdiction -- Diversity
Federal District Court Determines Jurisdiction Exists Based on Diversity of Citizenship in Coverage Action; Rejects Insured Municipal Utilities Authority's Attempt to Remand.
Old Bridge Mun. Utils. Auth. v. Westchester Fire Ins. Co., 2013 U.S. Dist. LEXIS 40953 (D.N.J. Mar. 25, 2013) The District of New Jersey ruled that an insurer's removal of a declaratory judgment action from state court was appropriate based on diversity of citizenship.  
 

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