ADJ8706846 — California WCAB decision

What the panel ordered

Petition for Reconsideration denied; Zurich policy found to provide workers' compensation coverage for Cool Air Supply on May 14, 2012; prior Findings and Order rescinded

Petition for Reconsideration granted to review insurance coverage issue; prior Findings and Order rescinded and replaced by this Decision After Reconsideration

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What was disputed, and how it came out

Each issue the panel decided, with the reasoning it gave. An outcome is what this panel did on this record — not a rule, and not a prediction.

Other disputed issueApplicant prevailed

Zurich policy did not include a limiting endorsement restricting coverage to a specific job site, so it was found to provide coverage for the injury site in Fullerton on May 14, 2012.

From the decision · page 2The essential facts are not in dispute. Applicant was injured in Fullerton California while employed by Cool Air Supply on May 14, 2012. Ullico Casualty Company insured the employer on that date and provided benefits in this case. Ullico became insolvent and CIGA took over administration of applicant's claim. Zurich also provided workers' compensation coverage for Cool Air Supply on May 14, 2012. (Exh. A, Exh.6, March 1, 2012, Workers' Compensation and Employers Liability Policy, WC 450435-02, Information Page.) Policy WC 450435-02 did not include language limiting coverage to a particular job site.

The facts that decided it

The rules the panel named

Authorities as the decision cited them, with how this panel applied each one.

TRB Investments, Inc. v. Fireman's Fund Ins. Co. (2006) 40 Cal. 4th 19

Interpretation of insurance policy follows general contract interpretation rules to ascertain mutual intent from the written provisions.

Applied to determine that Zurich policy was not site-specific.

From the decision · page 3The law is well-settled that "[i]nterpretation of an insurance policy is a question of law and follows the general rules of contract interpretation." (TRB Investments, Inc. v. Fireman's Fund Ins. Co. (2006) 40 Cal. 4th 19, 27.) "A contract must be so interpreted so as to give effect to the mutual intention of the parties as it existed at the time of contracting, so far as the same is ascertainable and lawful." (Civ. Code § 1636.) "Such intent is to be inferred, if possible, solely from the written provisions of the contract." (Deere & Co. v. Allstate Ins. Co. (2019) 32 Cal.App.5th 499, 513 citing Powerine Oil Co., Inc. v. Superior Court (2005) 37 Cal.4th 377, 390.)

Insurance Code section 1063.1

Insurance Code section 1063.1 defines CIGA's liability for covered claims of insolvent insurers.

Applied to define CIGA's liability and coverage obligations.

From the decision · page 5CIGA's liability is specifically defined in Insurance Code section 1063.1 as "covered claims." (Ins. Code, § 1063.1.) In the case of a policy of workers' compensation insurance, CIGA must cover the obligations of an insolvent insurer "to provide benefits under the workers' compensation law." (Ins. Code § 1063.1(c)(1)(F).) "[C]overed claims" under section 1063.1 "are not coextensive with an insolvent insurer's obligations under its policies." (Industrial Indemnity Co. v. Workers' Comp. Appeals Bd. (Garcia) (1997) 60 Cal.App.4th 548, 557 [62 Cal.Comp.Cases 1661].) Insurance Code section 1063.1(c)(5)(A) states: "`Covered claims' does not include an obligation to insurers, insurance pools, or underwriting associations, nor their claims for contribution, indemnity, or subrogation, equitable or otherwise, except as otherwise provided in this chapter." (Ins. Code, § 1063.1 (c)(5)(A).

ADJ8706846 · May 18, 2022

What the panel ordered

What was disputed, and how it came out

The facts that decided it

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The rules the panel named

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