Calif. court rules on CGL cover. (California Supreme Court; commercial general liability policyholders)

National Underwriter Property & Casualty-Risk & Benefits Management, January, 1998 by Lonkevich, Dan

The California Supreme Court handed commercial general liability policyholders another victory over insurers late last month in a complicated ruling requiring insurers to pay for pollution site investigation costs as defense costs. In Aerojet-General Corp. v. Transport Indemnity Co., the high court held unanimously on the narrow issue of whether site investigation costs, "to the extent they are reasonable and necessary to avoid or at least minimize liability," may constitute defense costs for coverage purposes under a CGL policy.

The court held 5-2 on another narrow issue -- holding that site investigation costs may be allocated to insureds in cases where only part of a claim is covered. John MacDonald, an attorney in the Philadelphia office of...

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