Second Department Finds No Coverage Based Upon Policy’s Designated Premises Limitation
305 Union St. Station, Inc., doing business as Kittery Restaurant, operates a restaurant in Brooklyn. Plaintiff, a pedestrian, was injured when she was struck by a bicycle operated by an employee of the restaurant who was on his way back from a food delivery. The accident occurred approximately one block from the restaurant. Plaintiff sued 305 Union for damages, obtained a judgment, and filed a direct action pursuant to New York Insurance Law § 3420(b) against DB Insurance Co., Ltd., 305 Union’s insurer, for satisfaction of the judgment. On summary judgment, DB maintained that there is no coverage for the judgment based upon a “Limitation of Coverage to Designated Premises or Project” endorsement in its policy that limits coverage to claims for “bodily injury … arising out of … [t]he ownership, maintenance or use of the premises [the restaurant] … and operations necessary or incidental to those premises.” The Supreme Court found coverage under the policy and DB appealed. The Appellate Division, Second Department reversed, finding that Plaintiff’s injury did not fall within the endorsement’s coverage limitation. The Second Department noted that the “primary issue on appeal centers on whether the actions of the restaurant’s employee were ‘operations necessary or incidental to [the] premises,’” which “requires a review of the alleged incident and its spatial and circumstantial connection to the covered premises.” The court explained that the endorsement affords coverage “where the incident takes place in a location that has a direct relationship to the covered premises and where the circumstances of the incident relate in some way to the nature of the covered premises itself, not just the business that is operating out of the covered premises.” The court found that the employee’s actions were not necessary or incidental to the covered premises – “[s]uch activity is, perhaps, incidental or necessary to the operation of the business, but the plain language of the policy covers only activity that is necessary or incidental to the premises.” [Catherine Normile v. DB Insurance Co., Ltd., et al., 2026 N.Y. Slip Op. 00788, 2026 N.Y. App. Div. LEXIS 751 (2d Dep’t Feb. 11, 2026).]
First Department Finds Unsigned Purchase Order Satisfies “Written Agreement” Requirement In Additional Insured Endorsement
James River Insurance Company issued certain liability policies to Arsenal Scaffold Inc., which included as an additional insured those entities required by written contract or written agreement to be added, but only for injury or damage caused, in whole or in part, by Arsenal’s acts or omissions in the performance of Arsenal’s work for the additional insured(s). Arsenal prepared a change order to perform certain work for A1 Specialized, Inc., that required Arsenal to procure additional insured coverage for A1. Arsenal began work “consistent with the terms of the change order” and provided A1 with a certificate of insurance identifying A1 as an additional insured under the James River policies, but the change order was not signed. A1 sought additional insured coverage from James River for an underlying tort action and James River denied coverage on the basis that A1 is not an additional insured under the James River policies. A1 filed a declaratory judgment action against James River and, on summary judgment, the Supreme Court ruled in favor of James River. A1 appealed and the Appellate Division, First Department, reversed, holding A1 is an additional insured under the James River policies. The First Department found that “James River’s insurance policies do not require a signed writing, merely a written agreement, and the record establishes that [A1] and Arsenal intended to enter into the agreement set forth in the change order.” Because “the change order qualifies as a written agreement requiring Arsenal to name [A1] as an additional insured,” the court found that James River had a duty to defend A1 in the underlying action. [A1 Specialized, Inc. v. James River Ins. Co., et al., 2026 N.Y. Slip Op. 00570, 248 N.Y.S.3d 50 (1st Dep’t Feb. 6, 2026).]
