Insurer loses argument over providing coverage; must defend construction claim
FH Martin Construction Company contracted with Cimarron Services to act as a sub on a Kroger remodeling site. Cimarron was required to provide indemnity insurance for FH Martin, and it bought liability insurance from Secura Insurance Holdings, Inc. to fulfill that obligation. In 2008, the FH Martin Company was sued by David Slater, another subcontractor on the construction site where FH Martin was the General. Slater argued that the General contractor had breached its duty to provide a common work area, and FH Martin argued that Slater's claim arose out of Cimarron activities.
Slater's claim was summarily dismissed, however, in the meantime, FH Martin sued Secura for failing to provide it the coverage Cimarron had purchased. Secura had agreed to insure "any person or organization for whom Cimarron was performing operations" if there was an underlying agreement for coverage, but it argued that this language did not apply because FH Martin wasn't a Named Insured on the policy. The Court held that the insuring language unambiguously granted coverage to FH Martin and dismissed Secura's appeal. I guess that one sad interpretation of this story is that insurance provides better protection to a corporation's money than it provides to a worker's safety.