When may insurer apply “insured vs. insured” exclusion?
When a former CEO of a nonprofit association sued the board of directors for damages the day after his termination of employment and captioned the complaint so that it appeared the association itself was the plaintiff, may the insurance carrier refuse to defend on the ground that the cases is excluded under the “insured vs. insured” exclusion? A trial court in Utah said the carrier was not required to pay the costs of defense after the Equine Assisted Growth and Learning Association defended its directors and forced the former CEO to voluntarily dismiss the complaint. The state Court of Appeals reversed, and the state Supreme Court has now agreed that coverage should not have been denied...
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