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Click here for the full text of this decision FACTS:An insurance broker, Greenwood Insurance Co., secured a $2 million per occurrence general liability insurance policy for All-Tex Roofing. The first million dollars of coverage was set with Resure, a surplus lines carrier with a “B” rating. Greenwood also secured an excess policy from United National Insurance. All-Tex was successfully sued for $1.3 million. United Nationwide paid a portion of the judgment, but because Resure had been declared insolvent two years earlier, there was no primary coverage. All-Tex filed two suits against Greenwood. Greenwood, in turn, called on its insurer, United States Liability Insurance Co. to defend the company. USLIC secured a summary judgment in favor of Greenwood based on limitations and on the theory that the judgment against All-Tex was not covered by the Resure policy, but this court reversed. USLIC then filed a declaratory judgment action that it owed no duty to defend or indemnify Greenwood for losses arising out of the All-Tex lawsuits. The trial court ruled for USLIC. HOLDING:Affirmed. The court characterizes the issue in this case as having never been decided by a Texas court. Greenwood’s professional liability policy (issued by USLIC) included an insolvency exclusion. Under it, USLIC would not defend for any claim “arising out of, directly or indirectly resulting from, based upon or in any way involving any actual or alleged” placement of risk with a carrier with less than a “B+” rating when the carrier becomes insolvent or bankrupt. Resure had a “B” rating, and it was placed into receivership, therefore, under the insolvency exclusion, there was no duty to defend Greenwood. The court looks at decisions from Florida, Georgia, Louisiana and New York upholding insolvency exclusions in professional liability policies. The court then rejects Greenwood’s argument that some of the allegations made by All-Tex are unrelated and independent of Resure’s insolvency. The broadly-worded language of the insolvency exclusion refers not only claims “arising out of” Resure’s bankruptcy, but also claims “in any way involving” Resure’s bankruptcy. “Resure’s bankruptcy set into motion a chain of events that caused All-Tex to sue Greenwood, and, in turn, led Greenwood to call on USLIC, its professional liability carrier, for defense and indemnity.” The court also rejects Greenwood’s argument that Resure denied All-Tex coverage based on the employee exclusion. Greenwood’s argument that the Resure policy might not have covered the loss is mere speculation. Similarly, the dispute between USLIC and Greenwood is most certainly ripe. Any question of fact based on whether Resure may have eventually paid or denied coverage is irrelevant. And the same reasons that negate the duty to defend likewise negate the possibility that the insurer will ever have a duty to indemnify. OPINION:Radack, C.J.; Radack, C.J., Jennings and Higley, JJ. CONCURRENCE:Jennings, J.; “I write separately to emphasize that this declaratory judgment action over insurance coverage boils down to the construction of an unambiguous contract.”

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