Top Court Ruling Seen As Insurance Neutral

Insurance coverage experts see no overall impact on insurer liabilities from a December 2004 U.S. Supreme Court ruling.

The ruling in Cooper Industries Inc. vs. Aviall Service Inc. essentially said a polluter cant bring contribution actions under the Comprehensive Environmental Response, Compensation and Liability Act against other potentially responsible parties to recover cleanup costs if the polluter did a voluntary cleanupin other words, if the polluter itself was not first subject to a CERCLA suit or administrative or judicially approved settlement.

Reasoning that no cleanups are truly “voluntary,” lawyers said coverage denials based on the absence of legal obligations to clean up are unlikely. Instead, lawyers Laurence Eisenstein and Peter Mintzer said the ruling will simply shift coverage burdens among insurers, as certain PRPs shoulder full costs that they otherwise could have shared with other PRPs.

Reproduced from National Underwriter Edition, April 8, 2005. Copyright 2005 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

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Top Court Ruling Seen As Insurance Neutral

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