The Second Department determined the “insured versus insured” policy exclusion was ambiguous and therefore could not be the basis for declaring the insurer, Princeton, did not have a duty to defend in this slip and fall case. Here an employee of one insured sued the company which owned the land, which was also insured by Princeton. The Second Department held it was not clear whether the plaintiff employee was an “insured” within the meaning of the exclusion:
“To be relieved of its duty to defend on the basis of a policy exclusion, the insurer bears the heavy burden of demonstrating that the allegations of the complaint [in the underlying action] cast the pleadings wholly within that exclusion, that the exclusion is subject to no other reasonable interpretation, and that there is no possible factual or legal basis upon which the insurer may eventually be held obligated to indemnify the insured under any policy provision” … . “[I]f the language is doubtful or uncertain in its meaning, any ambiguity will be construed in favor of the insured and against the insurer”… .
Here, Princeton disclaimed coverage based upon the “Insured Versus Insured” exclusion, which excluded “[a]ny claim’ made by or for the benefit of, or in the name or right of, one current or former insured against another current or former insured.” As it is not clear from the language of the exclusion at issue whether [plaintiff], as an employee, was an “insured” as that term was defined in the policy … , the provisions are ambiguous and subject to more than one interpretation … . Boro Park Land Co., LLC v Princeton Excess Surplus Lines Ins. Co., 2016 NY Slip Op 04684, 2nd Dept 6-15-16
INSURANCE LAW (POLICY EXCLUSION WAS AMBIGUOUS, INSURER HAD A DUTY TO DEFEND)/EXCLUSION, POLICY (INSURANCE LAW, POLICY EXCLUSION WAS AMBIGUOUS, INSURER HAD A DUTY TO DEFEND)/DUTY TO DEFEND (INSURANCE LAW, POLICY EXCLUSION WAS AMBIGUOUS, INSURER HAD A DUTY TO DEFEND)