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Targeted Tender Doctrine Allows Insured With Multiple Policies To Select Which Insurer Should Defend

A subcontractor’s employee was injured at a construction site. He sued the general contractor that was insured by Cincinnati as well as two subcontractors. As a result of the lawsuit, multiple policies were triggered. Erie insured one subcon- tractor, and AMCO insured another. The general contractor made a tar- geted tender of its defense to AMCO which was accepted. At a mediation, the case could settle for $1.5 million, AMCO attempted to get Cincinnati and the other contractor’s carrier to contribute equally with it. They refused. AMCO eventually settled the case for $1.45 million. It subse- quently filed a declaratory judgment action seeking to compel Cincinnati to contribute to the settlement. The trial court dismissed the complaint on the basis of the Targeted Tender Doctrine.

The First District affirmed. The Targeted Tender Doctrine allows an insured covered by multiple poli- cies to select or target which insurer should defend it with regard to a specific claim. Illinois courts have consistently held that an insured has a right to choose or knowingly forego an insurer’s participation in a claim. When an insured designates one carrier to defend, the duty to defend falls solely on the selected insurer. That insurer may not in turn seek equitable contribution from other insurers who might have ap- plicable coverage. AMCO Ins. Co. v. Cincinnati Ins. Co., 2014 IL App (1st) 122856. 

© 2020 Heyl, Royster, Voelker & Allen, P.C


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Employers are faced with more and more challenges in running their businesses due to the vast number of laws and regulations governing the workplace. An incorrect decision today may cost an employer a tremendous amount of time and money in the future. Our Employment & Labor Practice spans our six offices to provide a team approach to advising and defending employers on the most areas affecting employment, such as disciplinary actions, terminations, reductions-in-force, wage and hour issues, restrictive covenants, employment agreements, and various leave issues.

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