U.S. District Court holds endorsement eliminating coverage ineffective for failure to comply with statutory notice requirements

I have been discussing Whitaker Corp. v. Am. Nuclear Insurers, 2009 WL 4342512 (D. Mass.), a case involving insurance coverage for property owners of a superfund site.

In my last post I discussed Endorsement 112. The court held that its language excluded coverage for environmental cleanup costs.

The court went on to note that Endorsement 112 was therefore an elimination of coverage, since the policy otherwise covered environmental cleanup costs.

The court cited Mass. Gen. Laws ch. 175, § 111A, which requires that when a liability insurer eliminates coverage it attach to each policy a printed notice setting forth what coverages have been eliminated, and states that if the insurer does not do so then the coverage shall remain in full force and effect.

It was undisputed that no printed notice accompanied the Endorsement 112.

ANI argued that no notice was required because Endorsement 112 was a "new" policy rather than an amendment of an existing policy. The court disagreed, noting that the endorsement was entitled "Amendatory Endorsement" and is numbered "Endorsement 112" to "Policy No. NF-44."

The court held, "the Endorsement by any name is an amendment to the existing policy and it is incredulous for ANI to insist otherwise."