Case Study: California V. Continental Insurance

Law360, New York (August 27, 2012, 10:52 AM EDT) -- On Aug. 9, 2012, the California Supreme Court issued its highly anticipated decision in State of California v. Continental Insurance Co., S170506. The court’s opinion unanimously endorsed an “all-sums-with-stacking” rule for indemnity claims against successive policies arising out of progressive property damage.

State of California resolved two oft-disputed coverage issues: (1) how liability should be allocated across multiple successive policies in cases involving continuous, indivisible loss; and (2) whether the per-occurrence limits of successive, non-overlapping policies may be “stacked.”

The court’s opinion reaffirmed California’s commitment to...
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