Case Analysis : Fluor Corp V. Hartford Accident & Indemnity Co. Essay

743 WordsOct 19, 20153 Pages
In August, the California Supreme Court issued a new ruling holding an insured can assign its right to coverage against third-party claims, even after the loss or injury has occurred, despite “consent to assignment” clauses. The Supreme Court granted review of Fluor Corp v. Superior Court of Orange County to determine whether Insurance Code §520, which was not considered in its ruling in Henkel Corp. v. Hartford Accident & Indemnity Co. (2003) 29 Cal.4th 934, would change its decision concerning the enforceability of “consent to assignment” clauses in third party liability insurance policies. Fluor and Henkel concerned and insured’s right to assign the right to invoke defense and indemnification coverage under a liability policy. In Henkel, the Court held the consent-to-assignment clause was enforceable and precluded the insured’s right to assign without the insurer’s consent until there exists a “chose in action” against the insured. In Henkel, the “chose in action” was found to occur only when the claims have been reduced to a sum of money due under the policy. However, in Henkel, the Court did not consider Insurance Code §520. §520 provides that an insurer cannot limit an insured’s right to transfer or assign a claim for insurance coverage, and specifically bars the insurer from refusing to honor an insured’s assignment of the right to invoke coverage after a loss has occurred. Fluor involved a third party exposed to asbestos resulting in personal injury and
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