Century Surety Co. v. Jim Hipner LLC, No. 15-2120 (8th Cir. 2016)
Annotate this CaseCentury appeals the district court's final judgment determining that Hipner does have coverage under an umbrella policy entered between the parties. Because Wyoming law had not definitively addressed whether an insurer must be prejudiced before being entitled to deny coverage when the insured has failed to give notice “as soon as practicable,” the court certified the question to the Supreme Court of Wyoming. On certification, the Supreme Court of Wyoming adopted the notice-prejudice rule, holding that “prejudice to the insurer [is required] before coverage may be denied based upon a violation of a notice provision contained in the policy.” Additionally, that court held that “an insurance clause is [not] enforceable where it excludes coverage unless the insured notifies the insurer ‘as soon as practicable . . . whether [the insurer] [is] prejudiced or not.’” In this case, although Hipner did not provide timely notice to Century, the court concluded that Century failed to show how the four-month delay in receiving notice actually prevented it from taking any meaningful investigatory steps that it would have done had there been no delay. Because Century suffered no prejudice from the delay in notice, the court affirmed the judgment.
Court Description: Per Curiam - Before Smith, Bye and Benton, Circuit Judges] Civil case - Insurance. On certification from this court, the Supreme Court of Wyoming adopted the notice-prejudice rule, holding that prejudice to the insurer is required before coverage may be denied based upon a violation of a notice provision contained in the policy - Century Sur. Co. v. Hipner, 377 P.3d 784 (Wyo. 2016); under that court's two-step approach to an insurer's claim of late notice, the court must first determine whether the notice was untimely and second, if it was, determine whether the insurer prejudiced; here, the insured did not provide timely notice of an accident to Century; however, Century failed to show how the four-month delay in notice actually prevented it from taking any meaningful steps in the investigation of the case, and the district court did not err in finding Century suffered no prejudice.
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