Its a supreme Court of Missouri case, so the usual disclaimer applies.

The case of Scottsdale Ins Co. v Addison Ins Co et al is an interesting Insurance case.

The matter arose out of a very tragic road traffic accident resulting in the death of a driver, whose family sued for damages.

The Primary Insurer insured to a $1,000,000 limit. The excess insurer insured to a $2,000,000 limit.

A demand was made by the deceased’s family to settle the cast for $1,000,000. The primary insurer refused. It was a costly refusal. The Primary insurer later settled the case for $2,000,000. The excess insurer (Scottsdale) issued proceedings on the principle of equitable subrogation as a basis for an excess insurer to recover from a primary insurer’s wrongful refusal to settle a claim.

The Supreme Court of Missouri upheld the Court of Appeals decision to reverse the trial Judge’s judgement in favour of the Primary Insurer, recognising that the excess insurer could recover in equitable subrogation for the failure of the Primary Insurer.

Here is a report on the case