Allocation, Contribution, and Proration in the Restatement of the Law of Liability Insurance (PDF)
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This commentary focuses on a key issue currently under discussion by the drafters of the developing Restatement of the Law of Liability Insurance: the allocation of liability between policyholders and insurers, and among insurers. It argues that the Restatement should adopt the "Joint and Several or Pick and Choose Allocation Rule" rather than the "Proration Rule." It also finds that "other insurance" clauses do not require proration.
Lorelie S. Masters is a partner at Perkins Coie LLP in Washington, DC, and, since 2010, has served as an Advisor to the Restatement of the Law of Liability Insurance. She advises policyholders and represents them in litigation and arbitrations over insurance coverage. Ms. Masters is co-author of two widely recognized legal treatises: Insurance Coverage Litigation, updated annually; and Liability Insurance in International Arbitrations: The Bermuda Form (2d ed.), which won the British Insurance Law Association's 2012 Book Prize. Ms. Masters served as the policyholder Co-Chair of the Insurance Coverage Litigation Committee of the American Bar Association's Litigation Section from 2000-2003 and as an editor of the group's award-winning journal, Coverage. She has written extensively on insurance coverage issues and has served as an arbitrator and expert witness. The views expressed in this commentary are the author's own and should not be attributed to her clients, the ALI, or others.
The author thanks Amy Bach and Ann V. Kramer for their thoughtful comments on this commentary.
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