Source: http://texas-opinions.com/09-Prodigy-Communications-Corp-v-Agricultural-Excess-and-Surplus-Insurance-Tex-2009-by-Jefferson-effect-of-noncompliance-with-notice-condition-precedent-prejudice-test.html
Timestamp: 2019-04-23 16:10:23+00:00

Document:
Wainwright, Justice Brister, Justice Medina, and Justice Green.
Justice Johnson delivered a dissenting opinion, joined by Justice Hecht and Justice Willett.
absence of prejudice to the insurer. Id. at 636-37.
prejudiced by the delayed notice.
essential part of the bargained-for exchange under the claims-made policy at issue here.
practicable,” and remand the remaining issues to the trial court.
and cooperation as it may reasonably require.
brought against FlashNet, rather than purporting to provide the initial notice of the claim.
Discovery Period. Despite Prodigy’s efforts, AESIC never retreated from its no coverage stance.
Prodigy sued AESIC, seeking a declaration that Prodigy was contractually entitled to coverage.
petition. 51 Tex. Sup. Ct. J. 292 (Jan. 14, 2008).
specified in the policy; and (2) the insurer was not prejudiced by the delay.
outcome of this case for several reasons.
material breach, the other party's performance is excused.” Id. at 633 (quoting Hernandez, 875 S.
is, or is not, required.
notice was not an essential part of the bargained-for exchange in PAJ’s occurrence-based policy.
Ins. Co., 174 F.3d 653, 658 (5th Cir. 1999)).
within the policy period, regardless of when the claim is made.
Insurance § 130.1(A)(1) (2d ed. 2002) (“Holmes’ Appleman on Insurance 2D”); see also 1 Lee R.
Russ & Thomas F. Segalla, Couch on Insurance § 1.5 (3d ed. 2008) (“Couch on Insurance 3D”).
130.1(A)(1). This allows insurers “to calculate risks and premiums with greater precision.” Id.
liability insurance companies to issue the claims made policies at reduced premiums.” Id.
§ 186:13; see also Chas. T. Main, Inc. v. Fireman's Fund Ins. Co., 551 N.E.2d 28, 29 (Mass.
insurer within the policy period or within a specific number of days thereafter. See, e.g., Burns v.
(claims to be made against insured and reported to insurer during policy period).
the two types of reporting requirements differ sharply”).
in determining whether coverage exists” in a claims-made policy).
that notice be given during the policy period itself.
insured does not give notice of a claim within the policy’s specified time frame.
exists. Prejudice for an untimely report in this instance is not an appropriate inquiry.
requirement which is contained in the policy under review in this case and was not met.” Id.
made and reported within the extended reporting period. Id. at 227 n.7.
not “close its books” on the policy until ninety days after the discovery period expired. See F.D.I.C.
notice to the insurance carrier within the insurance policy period.”) (emphasis added).
failure to provide notice “as soon as practicable.” See PAJ, 243 S.W.3d at 636-37.
remaining issues to the trial court. Tex. R. App. P. 60.2(d).
THE INSURER TO DEFEND THOSE INSURED UNDER THE POLICY.” This is standard for D&O policies.
See 3 Rowland H. Long, The Law of Liability Insurance § 12A.05 (2006).
that notice of a claim be given “as soon as practicable . . ., but in no event later than” August 29, 2003.
for this matter under the Policy.
reported policies, and simply speak in broad terms of ‘claims-made’ policies.” Textron, Inc. v. Liberty Mut.
Chicago Ins. Co. v. Western World Ins. Co., No. Civ.A. 3-96-CV-3179R., 1998 WL 51363, at *3 (N.D. Tex.
Law of Liability Insurance, § 12A.05[3A] at 40 (Supp. 1991)).
the policy. The distinction is typically evident in the notice of claims provision of the policy.”).
requirements is at issue. 13 Couch on Insurance 3D § 186:13.
presumed where notice is not provided within the policy period”)(emphasis added); Nat’l Union Fire Ins. Co.
policy was sold in violation of the surplus lines statute.

References: § 130
 § 1

§ 186
 v. 
 v.

 § 12
 v. 
 v. 
 § 12
 § 186