Court rejects limits on payout for pollution.(Hercules Inc. vs. AIU Insurance Co.)(Brief Article)(Statistical Data Included)

Business Insurance, September, 2001 by Wojcik, Joanne

WILMINGTON, Del.-Both policyholders and insurers are claiming victory in a pollution coverage dispute in which the Delaware Supreme Court allowed a policyholder to stack policy limits but barred coverage for the cost of its preventive measures. The Aug. 15 decision reversed a lower court ruling that allowed a group of general liability insurers to indemnify chemical manufacturer Hercules Inc.

of Wilmington, Del., only for a portion of the policy limits they wrote. The lower court had ruled that each insurer was liable only for a fraction of the limits it wrote for Hercules the first year it was on the risk. Each insurer's share would have been based on the total number of years it covered Hercules. In overturning that ruling, a three-judge panel of the high...

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