Insurance Law

When a premium finance company cancels an insurance policy, Insurance Code requires that insurer shall give notice to any necessary governmental agencies. Finance company's failure to give notice of cancellation means that cancellation did not take effect, so that insurance policy on medical transport van was in effect on day of accident. (O'BRIEN and GALLAGHER, concurring.)

Ironworker was injured on construction site when load of structural steel escaped its rigging and struck her. Defendant Roszak hired Rockford Ornamental as a subcontractor, which in turn hired injured ironworker's employer as a subcontractor. Terms of additional insured endorsement on Rockford's policy exclude Roszak from coverage; thus, Rockford's CGL insurer has no duty to defend Roszak. In determining coverage, although complaint is to liberally construed in favor of insured, court is limited to the words of the underlying complaint. Ironworker's personal injury suit did not allege that Roszak was vicariously liable for the negligent acts or omissions of another, nor that Roszak retained sufficient control over details of Rockford's work so as to be vicariously liable for its acts or omissions. (CAHILL and J. GORDON, concurring.)

Multi-vehicle accident, from tractor-trailer driving into a mini-bus, with claims of negligence in allowing trailer to be operated without proper brakes. Accident resulted in deaths of eight people and injuries to many others; total 12 underlying actions consolidated into one action. Insurer filed interpleader action to deposit the limits of Defendant truck driver's employer with circuit court clerk. Two defendants' liability stems directly from actions of defendant driver and his employer, thus both are "persons insured" under policy. Affidavit which contains legal conclusions and does not clearly state that affiant has personal knowledge of the policy or of other event at issue was properly stricken. Insurer cannot discharge its duty to defend by depositing policy limits with the court, as parties did not settle and judgment not entered in underlying cases, and policy limit was not "paid" to anyone. Trial court is not required to wait until underlying case concludes before awarding attorney fees to insured.

Insurer sold CGL policies with separate endorsements at additional premium to cover liability for home repair and remodeling Four underlying complaints, including one filed by Illinois Attorney General, alleged fraud, misrepresentation, deception, and abuse. Complaints failed to allege "occurrence" or property damage within purview of policies, and exclusions for expected or intended injury preclude coverage. Thus insuring agreement in endorsement is inapplicable; and no evidentiary materials such as affidavits were filed that create issues of material fact that would affect insurer's right to judgments on its complaints. Thus, court properly entered summary judgment in favor of insurer on all complaints.

(Court opinion filed 12/24/09 withdrawn.) Eleven-year old boy sustained eye injury at paintball facility. Suit was consolidated with declaratory judgment action as to reasonableness of insured's notice of occurrence. Trial court granted summary judgment for insurer and agent, and denied Plaintiff's motion for summary judgment. 11-month delay in notification to insurer of service of suit was not unreasonable as a matter of law, as insured facility owner lacked experience in insurance matters, and at time of incident a physician at the scene washed out child's eye, he seemed fine, and had no further contact with facility about injury. Questions of fact exist as to late notice of occurrence, thus summary judgment for plaintiff or for insurer improper.

Insurer refused to defend restaurant group owner for customer's suit against Oak Brook restaurant for food poisoning. CGL policy extended to 15 of owner's restaurants listed in the policy's schedule, but not the Oak Brook location. Allegations of complaint, compared with policy provisions, did not trigger insurer's duty to defend or indemnify. Location of injury determined whether insurer had duty to defend, and complaint unambiguously identified Oak Brook restaurant as location where Plaintiff sustained her injury, and that restaurant did not appear in policy at time of incident and was thus excluded from face of policy.

Underlying lawsuit was filed alleging assault, battery, and intentional infliction of emotional distress from two incidents occurring two years apart, where Defendant brandished steel pipe and what appeared to be end of pistol, and Plaintiff subdued and restrained him in response. Defendant tendered defense of suit to CGL insurers which had issued policies for the two time periods. Duty to defend insured is triggered by allegations of self-defense in the insured's counterclaim filed in response to underlying suit alleging the insured's intentional acts, where the policy contains exclusion for intentional acts and a self-defense exception to that exclusion.

Court considered validity of auto policy exclusion that precludes liability coverage when person driving the vehicle does not have a "reasonable belief" of being entitled to do so; trial courts had held coverage exclusion applicable to drivers without valid drivers license. Reasonable belief exclusion applies equally to named insured and anyone using the vehicle with the insured's permission; the average, ordinary reasonable person would understand that the exclusion applies to unlicensed drivers. Exclusion does not violate Illinois public policy. Auto insurers may limit their risk by excluding insureds and permissive users who lack a valid drivers license.