Destroyed Community Property, Damaged Persons, and Insurers’ Duty to Indemnify Innocent Spouses and Other Co-Insured Fiduciaries: An Attempt to Harmonize Conflicting Federal and State Courts’ Declaratory Judgments
Estate Planning and Community Property Law Journal
Perhaps because of habit or a strong aversion to risks, consumers purchase a considerable amount of insurance generally, and consumers purchase property, indemnity, and liability insurance in particular. Typically, national property and casualty insurers sell property, indemnity, and liability insurance contracts. As a result, those insurers sales and revenues increase from year to year. At the dawn of the 21st century, foreign property and casualty insurers are realizing similar successes.
It is expected that anxious or prudent consumers would insure themselves and their various property interests against strangers, strange events, and perils over which consumers have little control or influence. Ironically, a large number of consumers also insure themselves and their property interests against familiar and trustworthy fiduciaries. Therefore, the property and casualty insurance market is huge; both national and foreign insurers are encouraged to expand and sell a wide variety of co-insured indemnity and liability insurance contracts. Under many co-insured contracts, the named insureds are familiar pairs of fiduciaries, such as estates and trustees, executors and administrators, professionals and associates, mortgagors and mortgagees, partners and partnerships, corporations and their officers and directors, business entities and their independent contractors, joint ventures, employers and employees, sellers and buyers, parents and children, and husbands and wives. State and federal judges are encouraged to apply more carefully settled, equitable doctrines to interpret insurance contracts and to award or deny innocent co-insureds petitions for declaratory relief. Current and past courts have considered illusive public policy to interpret valid insurance contracts, and that practice helps to generate judicial conflicts.
Willy E. Rice, Destroyed Community Property, Damaged Persons, and Insurers' Duty to Indemnify Innocent Spouses and Other Co-Insured Fiduciaries: An Attempt to Harmonize Conflicting Federal and State Courts' Declaratory Judgments, 2 Est. Plan. & Cmty. Prop. L.J. 63 (2009).