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Court clarifies ‘known claim’ exclusion applies in insurance coverage dispute

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The Indiana Court of Appeals granted rehearing to a case involving a dispute over coverage for environmental contamination and found that the “known claim” exclusion applies, not the known loss doctrine.

Patricia Kopetsky and Indiana Insurance Co. sought clarification from the appeals court regarding the possible finding that George Kopetsky knew of contamination in a housing development prior to obtaining CGL coverage from Indiana Insurance.

In June, the judges ordered a trial on the issue of whether the known loss doctrine would bar coverage by Indiana Insurance. George Kopetsky sold land to KB Home Indiana for a housing development. It’s alleged that he knew as early as May 2002 that some of the lots were contaminated. He obtained coverage from Indiana Insurance in April 2002 that was in effect for a four-year period.

The judges addressed the legal effect of Indiana Insurance’s knowledge of the contamination. Patricia Kopetsky argued that under the common law known loss doctrine, even if a jury found George Kopetsky knew of the contamination before taking out the policy, coverage would only be barred during the first of the four coverage years. The insurer, citing the known claim exclusionary language from the policies, argued that there is no coverage for the final three years, regardless of what the jury finds regarding George Kopetsky’s knowledge. It also argued that a finding he knew of the loss before obtaining coverage would bar coverage in the first year as well.

“We agree with Indiana Insurance because we conclude that, consistent with the Indiana Supreme Court’s approach in Sheehan Construction Co., Inc. v. Continental Casualty Co., 935 N.E.2d 160 (2010), the Policies’ ‘known claim’ exclusionary language controls,” Judge Cale Bradford wrote in Indiana Insurance Company v. Patricia Kopetsky, and KB Home Indiana Inc., 49A02-1304-PL-340.

That case requires the court to start with the policy language and determine if the loss would be covered under the general coverage clause and if any exclusions apply that would preclude coverage, without regard to whether the loss constituted an “economic loss.”

George Kopetsky knew of the contamination no later than May 2002, so coverage is barred for the second through fourth years, regardless of the jury’s finding of any prior knowledge. Any finding of knowledge of contamination prior to the first year of coverage only applies to the first year, Bradford wrote.

The original decision is affirmed in all other respects.  
 

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  1. Uh oh, someone is really going to get their panti ... uh, um ... I mean get upset now: http://www.theguardian.com/us-news/2015/mar/31/arkansas-passes-indiana-style-religious-freedom-bill

  2. Bryan, stop insulting the Swedes by comparing them to the American oligarchs. Otherwise your point is well taken.

  3. Sociologist of religion Peter Berger once said that the US is a “nation of Indians ruled by Swedes.” He meant an irreligious elite ruling a religious people, as that Sweden is the world’s least religious country and India the most religious. The idea is that American social elites tend to be much less religious than just about everyone else in the country. If this is true, it helps explain the controversy raking Indiana over Hollywood, San Fran, NYC, academia and downtown Indy hot coals. Nevermind logic, nevermind it is just the 1993 fed bill did, forget the Founders, abandon of historic dedication to religious liberty. The Swedes rule. You cannot argue with elitists. They have the power, they will use the power, sit down and shut up or feel the power. I know firsthand, having been dealt blows from the elite's high and mighty hands often as a mere religious plebe.

  4. I need helping gaining custody of my 5 and 1 year old from my alcoholic girlfriend. This should be an easy case for any lawyer to win... I've just never had the courage to take her that far. She has a record of public intox and other things. She has no job and no where to live othe than with me. But after 5 years of trying to help her with her bad habit, she has put our kids in danger by driving after drinking with them... She got detained yesterday and the police chief released my kids to me from the police station. I live paycheck to paycheck and Im under alot of stress dealing with this situation. Can anyone please help?

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