The Question of Allocation in Contribution Claims Between Insurers

Often a number of insurers are involved in claims that concern damage that takes place over several years such as environmental damage claims.  Oregon law allows claims for contribution by non-settling insurers against settling insurers under certain circumstances, Certain Underwriters v. Mass. Bonding and Ins. Co., 235 Or. App. 99, 230 P.3d 103 (2010), and equitable contribution claims between insurers are becoming more common.  Yet there is little guidance for how to allocate defense costs or indemnity among insurers on the risk. For coverage litigation concerning environmental claims, the 2013 amendments to the Oregon Environmental Cleanup Assistance Act (“OECAA”) provide that an insurer that has paid all or part of an environmental claim may seek contribution from any other insurer that is liable or potentially liable to the insured and that has not entered into a good-faith settlement agreement with the insured regarding the environmental claim. …

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