Central District Grants O&N Motion Against Hudson Specialty Insurance Company Regarding The Stacking and Erosion Of Self-Insured Retentions ("SIRs")

On April 11, 2017, the United States District Court for the Central District of California granted O&N’s motion for summary judgment against Hudson Specialty Ins. Co. The Court’s decision is significant for two reasons. First, the Court held that Hudson could not stack its SIRs, i.e., it could not condition its duty to defend upon the satisfaction of two separate SIR provisions in two separate policies. And second, the Court held that the relevant SIR eroded at defense counsel’s reasonable hourly billing rates rather than at discounted “Cumis” rates, which only become relevant after the relevant SIR has been satisfied and the insurer’s duty to defend has been triggered.

Click here to read the Court's ruling.

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