X
    X
    X
    X

    Louisiana Extends Pro Rata Allocation to Defense Costs

    Publications

    The Louisiana Supreme Court has endorsed pro rata allocation of defense costs associated with hearing loss cases across triggered policy periods. The decision reversed a 2015 appellate ruling that pro rata allocation applied to the costs associated with the duty to indemnify but not the duty to defend, making a single insurer responsible for all defense costs. The Supreme Court of Louisiana based its decision on the language in the policy at issue. Because the policy stated that it responded to bodily injury occurring during the policy period, the court noted that “neither party could reasonably expect that the insurer was liable for losses that occurred outside the policy coverage periods.” The ruling acknowledged that “while the duty to defend is broader than the duty to indemnify, neither obligation is broader than the policy’s coverage period …” Under the decision, the insured bears the shares of costs for periods in which it did not have insurance. The court endorsed a time on the risk assessment for calculations of shares and remanded the case to the trial court to determine the proper amount of defense costs to be paid by the insurer. Arceneaux v. Amstar Corp, et al., No. 2015-C-0588 (La. Sep. 7, 2016).

    Explore Additional Topics

    Disclaimer

    Please understand that your communications with Locke Lord LLP through this website do not constitute or create an attorney-client relationship with Locke Lord LLP. Any information you send to Locke Lord LLP through this website is on a non-confidential and non-privileged basis. Therefore, do not send or include any information in your email that you consider to be confidential or privileged.