Courts typically employ one of two methods for allocating insurance coverage for long-tail environmental claims among multiple policies, write Mark Rouvalis and Kenton Villano of the McLane Law Firm. The all-sums method can require payments up to the policy limit to cover an entire claim, while under the pro-rata approach used in Massachusetts and New Hampshire, the court allocates liability on a proportional basis across all policies, they write. Rouvalis and Villano recommend that policyholders seek competent counsel because of the complex nature of the claims, which can involve layers of coverage and potentially millions of dollars in liabilities.

Related Summaries