By Kevin L. Connors, Esquire
Does an employer’s liability exclusion, typically found in commercial general liability policies, preclude coverage, not limited to claims brought by employees of an insured, but also for claims that might be brought by the employees of the co-insureds against the same insured?
In Mutual Benefit Insurance v. Politsopoulos, 115 A.3rd 844 (Pa. 2015), the Pennsylvania Supreme Court, addressed the application of the employers’ liability exclusion, which typically provides that the insured is not entitled to insurance coverage when an employee of “the insured” brings a claim against the insured for “bodily injury … arising out of and in the course of … employment by the insured.”, with the insurer in Politsopoulos seeking an expansive interpretation of that exclusion, arguing that the employer’s liability coverage no longer applied when an insured is sued by its own employees, but also when the insured is sued by an employee of any co-insured.
Not so fast held the Pennsylvania Supreme Court.
Rejecting the insurer’s expansive interpretation, the Pennsylvania Supreme Court concluded that a commercial general liability insurance policy, in terms of policy language, makes various use of both definite and indefinite articles, creating ambiguity relative to the former, such that “the insured” may be reasonably taken as signifying the particular insured against whom the claim is asserted.
The Supreme Court also held that the policy “separation of insured’s” clause reinforced that understanding, that an insured and co-insured are not one and the same.
So concluding, with the Pennsylvania Supreme Court held in Politsopoulos that the employer’s liability exclusion, providing separate coverage under general liability insurance policies, does not preclude coverage for claims brought by the employees of a co-insured against the policy-holding insured.
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