Litigated for the policyholder by the late Eugene R. Anderson, founding shareholder of Anderson Kill P.C., Keene opened the door to pursuit of insurance coverage for long-tail claims at a time when asbestos and environmental liabilities were rocking corporate America.
In 1981, Keene Corporation faced millions of dollars in liabilities stemming from personal injury claims from plaintiffs alleging that they had been exposed to asbestos over the course of many years. The company filed claims with three insurance companies that had insured it at different times. Each insurance company claimed that the others were responsible for coverage. One claimed that the insurance company covering Keene when the plaintiffs were first exposed to asbestos was liable. Another asserted that the insurance company of record when plaintiffs’ injuries first manifested was responsible. And the third alleged that responsibility lay with the insurance company on the risk when the first plaintiff filed suit against Keene.
Faced with these “three bears,” Mr. Anderson came up with a reverse-Goldilocks solution. All three were “just right” — that is, right about the others. If an insurance company insured Keene at any time during the exposure, injury or claim, it was liable for the loss.
The D.C. Court of Appeals accepted that argument, which established the doctrine of the “triple trigger” for insurance coverage: a claim can be triggered at the time damage occurs, at the time it manifests itself, or at the time when a plaintiff seeks redress.
Comprehensive General Liability policies at that time were “occurrence-based,” meaning that they covered events that occurred during the policy period, regardless of when a claim was filed. In an important sense such policies never expire: if damage that occurs during the policy period manifests itself decades later, the policy must respond. The triple trigger opened the door to claims brought against insurance companies that covered the policyholder across decades in which damage occurred without detection.
The principles articulated in the Keene decision were applied to environmental liabilities arising from the Superfund law passed in December 1980 as well as to a rising tide of asbestos liabilities. As a result, insurance was instrumental to funding cleanup of hundreds of environmental sites, while hundreds of thousands of people afflicted with asbestos-related diseases had access to insurance-funded trusts devoted to their compensation.
Gene Anderson built on this victory to spend decades pursuing claims and advancing legal theories that held insurance companies to the promises embedded in policy language – or, in some cases, to the interpretation of ambiguous language that insurance companies themselves advanced when pitching proposed policy language to regulators. He built a firm and practice specialty focused on helping policyholders get the coverage they paid for and fighting deep-pocketed insurance companies in court when they asserted overly broad interpretations of policy exclusions and limitations.
At Anderson Kill, Gene’s heirs continue to build on his legacy, establishing legal principles that enable policyholders to maximize coverage: that insurance companies must be held to policy promises to pay “all sums” for which the policyholder becomes liable; that policyholders facing long-tail claims can “stack” policies across multiple policy periods; that insurance companies may be liable for “consequential damages” stemming from their refusal to pay; that exclusions for “expected or intended” damage do not apply to successor corporations that know nothing of relevant prior acts.
The persistence, creativity and relentless logic that Gene Anderson brought to bear in Keene transformed insurance coverage, risk management and legal practice. Anderson Kill remains committed to building on his legacy to uphold policyholder rights and compel the insurance industry to live up to its stated purpose.