Article Date: 02/28/2014

State Supreme Court: Self-Insured Retention in General Contractor’s CGL Policy Satisfied by Settlement Contribution Made by Another Insurance Company

A state supreme court has held that the self-insured retention (SIR) in a general contractor’s commercial general liability (CGL) policy was satisfied by the settlement contribution of another insurance company. The CGL insurer, General Fidelity Insurance Co., had argued that the SIR only could be satisfied by the policyholder's use of its own money. The Supreme Court disagreed in light of the wording of the particular SIR before it while recognizing that other SIR endorsements might be worded clearly enough to achieve that result.


The ConstructionPro Week summary of this case is available to ConstructionPro Network members and includes:

  • The citation for the case
  • The details of the case
  • Author’s commentary
  • A link to the complete PDF copy of the original opinion

Here is a portion of the author's commentary:


"The decision also should aid policyholders who want to access coverage as additional insureds under the policies of another, such as a subcontractor, but cannot because the named insured has become bankrupt and cannot pay the SIR out of its own pocket. It should allow the additional insured to pay the named insured's SIR, particularly if it is relatively low, thereby triggering the remainder of coverage under that policy. (Both payments then might be used to satisfy a larger SIR under the policyholder’s own policy.)"



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