Continental Casualty Co. v. Rapid-American Corp.
80 N.Y.2d 640 | New York Court of Appeals | 1993
What This Case Means for Subcontractors
Continental Casualty Co. v. Rapid-American Corp. (1993) established that insurers must defend policyholders against asbestos exposure claims even when injuries appear after the policy period ends. The court ruled that pollution exclusions don't apply to occupational asbestos inhalation injuries. An insurer's duty to defend is triggered whenever a complaint reasonably suggests coverage is possible, based on the complaint's language alone. This matters to subcontractors because it clarifies that your general liability insurance should cover asbestos-related claims from work performed during the policy period, regardless of when symptoms develop.
Key Takeaways
- •Your insurer must defend you if the complaint alleges any reasonable possibility of coverage—they can't deny defense based on their interpretation of policy language alone.
- •Asbestos exposure claims from occupational work are not blocked by standard pollution exclusions, so your CGL policy should provide coverage for these claims.
- •Latent injuries (those appearing years later) are still covered if exposure occurred during the active policy period—timing of injury discovery doesn't eliminate coverage.
An insurer must defend whenever the four corners of the complaint suggest a reasonable possibility of coverage.
Frequently Asked Question
If a worker gets sick from asbestos years after I finished a job, will my insurance cover it?
Yes, if the exposure happened during your active policy period. The court ruled that latent injuries (those appearing later) are still covered because the 'occurrence' happened when the worker was exposed, not when they got sick. Your insurer must defend the claim even if symptoms show up after the policy ends.
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