The Duty to Notify an Excess Carrier: Considerations for Defense Counsel

The relationship between a primary and excess insurance carrier within the context of a catastrophic medical malpractice litigation is fraught with possible pitfalls. While the ultimate battles between primary and excess carriers are often resolved during negotiations between their officers and counsel, defense counsel retained by the primary insurance carrier should be mindful of the potential role that an excess carrier may assume leading up to the final disposition of a catastrophic claim. In this context, we address herein factors such as the duties that may exist between primary and excess insurers; the circumstances in which an excess carrier may be required to “drop down”; cases in which an excess insurer may defend or reimburse defense costs incurred by the insured or the primary insurer; and potential notice issues arising between primary and excess insurers.