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Multi-Year and Stub Policies: The Expectations and Economics of Providing Full Limits of Liability
When an insurance policy is written for a single year, little controversy exists regarding the limits of liability. Multi-year policies, those written for more than one annual period, and stub policies, those in effect for less than a year, are, however, becoming a source of disagreement. Particularly with long-tail claims such as asbestos, chemical exposures, and welding rod litigation triggering historic policies from the 1960s and 1970s, litigation on these issues is becoming ever more important. There is no established general rule regarding the available limits for these types of policies. Rather, courts apply a case-specific analysis of the evidence and policy language to determine the parties' intent regarding the policy's limits. Based on the policy language, or lack thereof, courts have, with limited exceptions, found full aggregate limits during each annual period for multi-year policies and an additional set of limits for stub policies. Such findings are supported by policy language, general legal principles, the economics of the parties' transactions, and industry practice.
Multi-Year Policies
Annualized limits for multi-year policies were considered standard practice in the insurance industry for several decades. See, e.g., Soc'y of the Roman Catholic Church of Diocese of Lafayette and Lake Charles, Inc. v. Interstate Fire & Cas. Co., 126 F.3d 727, 742 (5th Cir. 1997) (commenting that industry practice during the 1970s and 1980s was 'that three-year insurance policies were generally annualized'). See also Jeannine W. Chanes, Once Is Never Enough: Annualization Of Per Occurrence Limits in Three-Year Policies, 14-27 Mealey's Litig. Rep. Ins. 10 (2000) (explaining that three-year policies were beneficial to policyholders because they ”lock in' favorable premium rates' and 'reduced frictional (transactional) costs' for policy renewals) (citing Philip Gordis and Edward Chalanda, Property and Casualty Insurance, at 420 (29th ed. 1984)). During that time, it was standard practice for insureds and brokers to arrange for layers of coverage, expecting that, unless specifically set forth otherwise, layers would fit together seamlessly and operate like those below. This was true for both the scope and the limits of coverage.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Legal Possession: What Does It Mean?
Possession of real property is a matter of physical fact. Having the right or legal entitlement to possession is not "possession," possession is "the fact of having or holding property in one's power." That power means having physical dominion and control over the property.
The Anti-Assignment Override Provisions
UCC Sections 9406(d) and 9408(a) are one of the most powerful, yet least understood, sections of the Uniform Commercial Code. On their face, they appear to override anti-assignment provisions in agreements that would limit the grant of a security interest. But do these sections really work?