In January of 2011, 10 ACE Group Companies agreed to pay $70 million in settlement fees to the New York Workers’ Compensation Board after an investigation into whether certain insurance companies had been overcharging policyholders.
Worker Death Suit Prompts ACE Unit to Sue Client
May 6th, 2013 - Illinois Union Insurance Co. has gone to court in an effort to get a court to back its contention that a collapsed building was not properly identified as subject to its commercial general liability policy.
The ACE Group unit filed suit in U.S. District Court for the Eastern District of New York against client Midwood Lumber & Millwork Inc. and 10 other defendants. Two of the defendants are suing
Midwood for injuries sustained in the collapse, while a third defendant is the administrator of the estate of a man killed in the accident.
Midwood was hired to help construct a low-rise residential building at 227 Carlton Ave. in Brooklyn. On Sept. 10, 2012, the building collapsed and construction worker Winston Gillette was killed, while Ignatius Regis and Clayton LaBoard were injured.
Regis and Laboard, and the estate of Gillette, filed separate injury recovery lawsuits that named Midwood as a defendant. Illinois Union is currently defending Midwood in those actions, but said that it does not owe its client any further duty for the simple reason that the building where the accident happened is not a covered property.
Illinois Union sold insurance coverage to Midwood for a period May 25, 2012, to May 25, 2013. The policy contained an endorsement that extended coverage to “designated premises.” At the time of the accident, the insurer said that 227 Carlton Ave. was not one of those properties.
Further, Illinois Union contended that the collapse occurred “as a result of Midwood’s use of its truck to load and unload materials on the roof of the subject building.” As such, coverage would be barred by an auto exclusion to the policy.
New York Building Commissioner Robert LiMandri told The Daily News at the time of the accident that the floor of the building “was not structurally stable.”
In addition to a denial of coverage declaration, Illinois Union also asked the court to let it recoup defense costs in an amount it said it will provide and prove at trial.
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