Title: Continental Insurance Company v. Honeywell International, Inc.
Citation: N/A
Docket Number: 
State: new-jersey
Issuer: new-jersey Supreme Court
Date: June 27, 2018

Continental Insurance Company v. Honeywell International, Inc. Annotate this Case Justia Opinion Summary This appeal involved questions about the insurance coverage available to defendant Honeywell International, Inc. (Honeywell) for thousands of bodily-injury claims premised on exposure to brake and clutch pads (friction products) containing asbestos. The New Jersey Supreme Court granted certification to address two issues: (1) whether the law of New Jersey or Michigan (the headquarters location of Honeywell’s predecessor when the disputed excess insurance policies were issued) should control in the allocation of insurance liability among insurers for nationwide products-liability claims; and (2) whether it was error not to require the policyholder, Honeywell, to contribute in the allocation of insurance liability based on the time after which the relevant coverage became unavailable in the marketplace (that is, since 1987). The Supreme Court determined New Jersey law on the allocation of liability among insurers applied in this matter, and the Court set forth the pertinent choice-of-law principles to resolve this dispute over insurance coverage for numerous products-liability claims. Concerning the second question, on these facts, the Court also affirmed the determination to follow the unavailability exception to the continuous-trigger method of allocation set forth in Owens-Illinois, Inc. v. United Ins. Co., 138 N.J. 437 (1994). Read more Want to stay in the know about new opinions from the Supreme Court of New Jersey? Sign up for free summaries delivered directly to your inbox. Learn More › You already receive new opinion summaries from Supreme Court of New Jersey. Did you know we offer summary newsletters for even more practice areas and jurisdictions? Explore them here . SYLLABUSThis syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Court. In the interest of brevity, portions of an opinion may not have been summarized.) Continental Insurance Company v. Honeywell International, Inc. (A-21-16) (078152)Argued October 24, 2017 -- Decided June 27, 2018LaVECCHIA, J., writing for the Court. This appeal involves questions about the insurance coverage available to defendant Honeywell International, Inc. (Honeywell), a New Jersey based corporation, for thousands of bodily-injury claims premised on exposure to brake and clutch pads (friction products) containing asbestos. The Court granted certification to address two issues. First, whether the law of New Jersey or Michigan (the headquarters location of Honeywell’s predecessor when the disputed excess insurance policies were issued) should control in the allocation of insurance liability among insurers for nationwide products-liability claims. Second, whether it was error not to require the policyholder, Honeywell, to contribute in the allocation of insurance liability based on the time after which the relevant coverage became unavailable in the marketplace (that is, since 1987). The Bendix Corporation (Bendix) -- a corporate predecessor to defendant Honeywell -- for many years manufactured and sold friction products that contained asbestos. Bendix stopped using asbestos in its friction products in 2001, having continued to manufacture the items even after 1987 when insurance for asbestos-related claims for such products ceased to be available in the marketplace. In 2000, Continental Insurance Company (Continental) (which wrote many primary insurance policies for Bendix during the relevant years), and related companies, commenced this action seeking declaratory relief concerning the rights and obligations associated with insurance coverage for the asbestos-related bodily injury claims filed against Honeywell as a corporate successor to Bendix. The choice-of-law issue: Bendix was incorporated in 1929 under the laws of the State of Delaware. Aspects of its business took place in different states. Between 1969 and 1983, Bendix situated its executive headquarters, including its insurance office, in Michigan; another central office was in New York. Bendix also had significant contacts with New Jersey. Until 1973, Bendix’s largest center of operations and payroll was in New Jersey. Honeywell is the corporate successor to Bendix. Honeywell’s headquarters and principal place of business have always been located in Morristown, New Jersey. Since 1983, all insurance operations for Bendix and its successors have been located in New Jersey. The excess insurance policies at issue here were all brokered, issued, and delivered to Bendix in Michigan. None contain a choice-of-law provision governing the allocation issue. In 2006 the trial court held that New Jersey insurance-allocation law would apply in this matter. 1 The allocation issue: Under New Jersey’s current law on allocation of liability among insurers, an insured is not forced to assume responsibility in allocation during the insurance coverage block of policies for years in which insurance is not reasonably available for purchase. Owens-Illinois, Inc. v. United Ins. Co., 138 N.J. 437, 478-79 (1994). Travelers Casualty & Surety Company (Travelers) (taking the lead in argument) and St. Paul Fire and Marine Insurance Company (St. Paul), both excess insurers, argued that the coverage block should run until the year in which Honeywell, as the successor to Bendix, ceased manufacturing the friction products -- 2001. Honeywell maintained that the coverage block should end in the 1986-87 period when first primary (1986) and then excess (April 1, 1987) insurance ceased to be available. Applying Owens-Illinois’s approach to allocation of risk to claims arising exclusively from pre-1987 initial exposure, the court determined in 2011 that the unavailability of commercial insurance should end the coverage block of insurance. The trial court entered a final judgment in 2013, after which Travelers and St. Paul jointly appealed the trial court’s 2006 order, which granted Honeywell’s partial summary judgment motion and applied New Jersey allocation law, and the 2011 order, which granted Honeywell’s partial summary judgment motion and held that Honeywell had no allocation responsibility for pre-1987 initial exposure claims because after 1987 it was not able to obtain insurance coverage for asbestos claims. The Appellate Division affirmed but required a remand not pertinent to this appeal. The Court granted certification. 228 N.J. 437 (2016).HELD: New Jersey law on the allocation of liability among insurers applies in this matter, and the Court sets forth the pertinent choice-of-law principles to resolve this dispute over insurance coverage for numerous products-liability claims. Concerning the second question, on these facts, the Court also affirms the determination to follow the unavailability exception to the continuous-trigger method of allocation set forth in Owens-Illinois.1. The first step in a conflicts analysis is to decide whether there is an actual conflict between the laws of the states with interests in the litigation. New Jersey law employs the continuous-trigger doctrine, as initially adopted in Owens-Illinois, 138 N.J. 437. Given that the continuous-trigger theory would implicate multiple insurance policies, the Court also adopted a methodology for allocating liability among those policies. Id. at 474-75. When determining an insurer’s liability, a court is to consider both the insurer’s time on the risk and the degree of risk that insurer assumed. Ibid. Several policy rationales were at work in the Owens-Illinois approach. See id. at 472-76. The Court emphasized that the theory underlying insurance is risk allocation, id. at 472, and that an insurance allocation scheme that spreads costs throughout the industry and promotes an efficient use of resources translates to more money available to respond in the event of disease and damage, id. at 478. Michigan utilizes a different allocation method. In Arco Industries Corp. v. American Motorists Insurance Co., 594 N.W.2d 61, 69 (Mich. Ct. App. 1998), aff’d by an equally divided court, 617 N.W.2d 330 (Mich. 2000), the Michigan Court of Appeals specifically considered and rejected the Owens-Illinois approach, concluding that policy considerations weighed in favor of adopting the time-on-the-risk method. A substantive difference separates the New Jersey and Michigan legal approaches and policy considerations here, and so the Court must engage in a choice-of-law analysis. (pp. 30-37) 2 2. The Court stated in State Farm Mutual Automobile Insurance Co. v. Estate of Simmons that “the law of the place of the contract ordinarily governs the choice of law because this rule will generally comport with the reasonable expectations of the parties . . . and will furnish needed certainty and consistency in the selection of the applicable law.” 84 N.J. 28, 37 (1980). In Simmons, the Court relied on § 193 of the Restatement (Second) of Conflict of Laws (Am. Law Inst. 1971) (Restatement). Id. at 35-36, 57. Since Simmons, the Court has discussed the role of two other pertinent Restatement provisions. Section 188 of the Restatement generally addresses conflicts-of-law determinations in contract settings where the parties have not made an effective choice of law. Section 6 of the Restatement sets forth the factors that are relevant in a conflicts determination when there is no local statutory directive controlling the issue. In Gilbert Spruance Co. v. Pennsylvania Manufacturers’ Ass’n Insurance Co., the Court considered choice of law regarding insurance coverage in the context of a mass tort and noted that, when determining the conflicts-of-law rule to govern casualty-insurance contracts, Restatement § 193 usually is initially consulted but that Restatement §§ 188 and 6 are analytically more appropriate. 134 N.J. 96, 97, 104 (1993). Courts have found it “tempting” to extract from Spruance a “bright-line rule.” The Court clarified in Pfizer, Inc. v. Employers Insurance that “there is no way to avoid a careful site- specific determination, made upon a complete record,” and that, when the risk is “to some degree transient,” a court must use the Restatement § 6 factors in its analysis. 154 N.J. 187, 197 (1998). Although condensed and reframed into four inquiries, the Pfizer analysis nevertheless remained tethered to the section 6 factors. (pp. 37-46)3. In a contract dispute over insurance allocation for nationwide products liability claims asserting bodily injury due to asbestos exposure, neither Restatement § 193 nor Simmons provides the proper starting point. The conflicts analysis here should center on Restatement §§ 188 and 6, as the later decisions in Spruance and Pfizer have taught. With respect to the § 188 contacts, not all are of equal importance or value in this fact-specific inquiry. Two strong considerations under § 188, applied to this matter, combine to point toward New Jersey. Here, the place of performance, § 188(c), and the domicile, residence, and places of incorporation and of business of the parties, § 188(e), all point to New Jersey. The latter takes into account enduring characteristics and deserves to be a starting point in the analysis. Further, heavy weight must be given to the nature of the insured risk and its site. New Jersey is the longstanding domicile of the insured in this litigation (since 1983). Turning to the Restatement’s factors in section 6, helpfully condensed in Pfizer, the question is whether New Jersey’s relationship with the case is sufficiently significant to warrant application of New Jersey law. The first inquiry described in Pfizer consolidates several § 6 factors and asks, simply, whether application of the competing states’ laws would advance the policy interests that the law was intended to promote. The second Pfizer factor focuses on whether application of a competing state’s law would frustrate the policies of other states. The third factor considers the interests of the parties, and the contacts outlined in Restatement § 188 the come to the fore. Finally, courts look at the interests of judicial administration under the last Pfizer factor, which asks “what choice of law works best to manage adjudication of the controversy before the court.” 154 N.J. at 199. Applying those inquiries, conflicts-of-law principles favor application of New Jersey allocation law in the present dispute over liability among insurers and affirms the Appellate Division on the first issue. (pp. 46-54) 3 4. The continuous-trigger and related unavailability exception theories for allocation of insurance liability have been recognized and applied in New Jersey since Owens-Illinois. The Court determined to use that method of allocation of liability, finding it superior by virtue of (1) encouraging the acquisition of insurance and spreading costs throughout the industry; (2) promoting the efficient use of insurance resources to make more money available to respond in catastrophic circumstances; (3) compelling insurers to minimize their costs; and (4) advancing principles of simple justice. 138 N.J. at 472-78. The continuous- trigger method assumes the availability of insurance and incorporates an unavailability exception. Courts have applied the “unavailability exception,” in accordance with Owens- Illinois, to require an insured to share in an allocation of liability under the continuous- trigger doctrine only when it foregoes purchasing available insurance. (pp. 54-55)5. St. Paul and Travelers ask the Court to create an equitable exception to the unavailability rule, whereby corporations that continue to manufacture products after insurance becomes unavailable for those products would be deprived of the insurance coverage they purchased prior to that unavailability. The Court has affirmed that the continuous-trigger theory of liability is the law of New Jersey multiple times since Owens-Illinois. That theory holds insurers responsible for the losses that actually occur on their watch, using a formula that approximates a scientific assessment of the amount of injury, even if the actual injury manifests later. Clearly, the law on allocation methodology differs among the states. No doubt, legitimate policy reasons may have led sister courts to reach diverse conclusions. In Owens-Illinois the Court acknowledged that “[i]f, after experience, we are convinced that our solution is inefficient or unrealistic, we will not hesitate to revisit” the allocation paradigm with its continuous-trigger and unavailability doctrines. 138 N.J. at 478. This appeal, however, does not present a compelling vehicle to reconsider New Jersey precedent on allocation. None of the initial asbestos exposures, on which claims Honeywell is seeking insurance coverage, occurred after insurance became unavailable. Although the disputed policies involved in this appeal concern excess insurance, they are occurrence policies. This case simply does not present facts on which to consider abandoning the unavailability exception, let alone whether to create a novel equitable exception to that exception. Indeed, the basic policy objectives of Owens-Illinois are all served by affirming the judgment as to the coverage block and moving the case to closure. (pp. 55-64) AFFIRMED. JUSTICE ALBIN, dissenting in part, expresses the view that, as applied here, the judicially created doctrine known as the “unavailability exception” gives a corporation a free pass if it continues to expose workers to extremely dangerous products after insurance coverage becomes unavailable and stresses that equity demands that a corporation that continues to manufacture a dangerous product without insurance become the ultimate insurer for its actions. Justice Albin concurs in the Court’s conflict-of-law analysis and resolution.CHIEF JUSTICE RABNER and JUSTICES FERNANDEZ-VINA, SOLOMON, and TIMPONE join in JUSTICE LaVECCHIA’s opinion. JUSTICE ALBIN filed an opinion, dissenting in part. JUSTICE PATTERSON did not participate. 4 SUPREME COURT OF NEW JERSEY A- 21 September Term 2016 078152CONTINENTAL INSURANCE COMPANY, FIDELITY & CASUALTY COMPANY OF NEW YORK, COMMERCIAL INSURANCE COMPANY OF NEWARK, N.J., and COLUMBIA CASUALTY COMPANY, Plaintiffs, v.HONEYWELL INTERNATIONAL, INC. (f/k/a ALLIEDSIGNAL, INC., successor to BENDIX AVIATION CORPORATION and BENDIX CORPORATION), Defendant-Respondent, andST. PAUL FIRE AND MARINE INSURANCE COMPANY, Defendant-Appellant, andAFFILIATED FM INSURANCE COMPANY, ALLSTATE INSURANCE COMPANY, AMERICAN HOME ASSURANCE COMPANY, AMERICAN INSURANCE COMPANY, CALIFORNIA UNION INSURANCE COMPANY, CENTURY INDEMNITY COMPANY, COMMERCIAL UNION INSURANCE COMPANY as successor to EMPLOYERS LIABILITY ASSURANCE CORPORATION, LTD., EMPLOYERS INSURANCE OF WAUSAU, FIREMAN’S FUND INSURANCE COMPANY, GRANITE STATE 1 INSURANCE COMPANY, GREAT AMERICAN INSURANCE COMPANY, HOME INSURANCE COMPANY, INSURANCE COMPANY OF NORTH AMERICA, NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA, NORTH RIVER INSURANCE COMPANY, TRAVELERS INDEMNITY COMPANY, UNDERWRITERS AT LLOYDS LONDON and CERTAIN LONDON MARKET COMPANIES, including ANGLO SAXON INSURANCE ASSOC. LTD., DOMINION INSURANCE COMPANY, DRAKE INSURANCE COMPANY, EAGLE STAR INSURANCE COMPANY, INSTITUTE OF LONDON UNDERWRITERS, LONDON & EDINBURGH INSURANCE COMPANY LTD., PRUDENTIAL ASSURANCE COMPANY LTD., SOUTHERN INSURANCE COMPANY, and WORLD AUXILIARY INSURANCE CORP., LTD., Defendants, andHONEYWELL INTERNATIONAL, INC. (f/k/a ALLIEDSIGNAL, INC., successor to BENDIX AVIATION CORPORATION and BENDIX CORPORATION), Defendant/Third-Party Plaintiff-Respondent, v.TRAVELERS CASUALTY & SURETY COMPANY (f/k/a AETNA CASUALTY & SURETY COMPANY), Third-Party Defendant- Appellant, 2 andAIU INSURANCE COMPANY, AMERICAN CENTENNIAL INSURANCE COMPANY, ASSOCIATED INTERNATIONAL INSURANCE COMPANY, CENTRE INSURANCE COMPANY (f/k/a LONDON GUARANTEE AND ACCIDENT COMPANY OF NEW YORK), CONTINENTAL CASUALTY COMPANY, THE CONTINENTAL INSURANCE COMPANY as successor in interest to HARBOR INSURANCE COMPANY (f/k/a HARBOR INSURANCE COMPANY), EVEREST REINSURANCE COMPANY (f/k/a PRUDENTIAL REINSURANCE COMPANY), EXECUTIVE RISK INDEMNITY INC. (f/k/a AMERICAN EXCESS INSURANCE COMPANY), FEDERAL INSURANCE COMPANY, FIRST STATE INSURANCE COMPANY, FREMONT INDEMNITY COMPANY (f/k/a INDUSTRIAL INDEMNITY COMPANY), GENERAL REINSURANCE CORPORATION, HARTFORD ACCIDENT & INDEMNITY COMPANY, INTERNATIONAL INSURANCE COMPANY (f/k/a INTERNATIONAL SURPLUS LINES INSURANCE COMPANY), LEXINGTON INSURANCE COMPANY, MT. MCKINLEY INSURANCE COMPANY (f/k/a GIBRALTAR CASUALTY COMPANY), MUTUAL FIRE, MAINE & INLAND INSURANCE COMPANY, ROYAL INDEMNITY COMPANY, THE TOKIO MARINE & FIRE INSURANCE COMPANY, LTD., TWIN CITY FIRE INSURANCE COMPANY, UTICA MUTUAL INSURANCE COMPANY, WESTPORT INSURANCE COMPANY (f/k/a PURITAN INSURANCE COMPANY), and CERTAIN LONDON MARKET COMPANIES, including 3 ACCIDENT & CASUALTY INSURANCE COMPANY, ALBA GENERAL INSURANCE COMPANY (f/k/a ALBA GENERAL INSURANCE COMPANY LIMITED), AVIATION & GENERAL INSURANCE COMPANY LIMITED, AXA INSURANCE PLC (f/k/a PROVINCIAL INSURANCE PUBLIC LIMITED COMPANY), THE BRITISH AVIATION INSURANCE COMPANY LIMITED, BRITISH LAW INSURANCE COMPANY LIMITED, BRITISH RESERVE INSURANCE COMPANY LIMITED, BRITISH TRADERS INSURANCE COMPANY LTD., C.A.M.A.T. INSURANCE COMPANY LIMITED, C.F.A.U., CONTINENTAL ASSURANCE COMPANY OF LONDON, LTD., CORNHILL INSURANCE PUBLIC LIMITED COMPANY (f/k/a CORNHILL INSURANCE COMPANY LIMITED), EDINBURGH ASSURANCE COMPANY LTD., EDINBURGH INSURANCE COMPANY LIMITED, EDINBURGH NO. 2 GROUP, ELVIA SWISS INSURANCE COMPANY (f/k/a HELVETIA ACCIDENT INSURANCE COMPANY LIMITED), EXCESS INSURANCE COMPANY LIMITED, FIDELIDADE INSURANCE COMPANY OF LISBON, GE SPECIALTY INSURANCE (UK) LIMITED (f/k/a THREADNEEDLE INSURANCE COMPANY LIMITED), GENERAL INSURANCE COMPANY HELVETIA LIMITED, GROUPAMA INSURANCE COMPANY LIMITED (f/k/a MINISTER INSURANCE COMPANY LIMITED), HELVETIA INSURANCE COMPANY LTD., HELVETIA SWISS INSURANCE COMPANY LIMITED (f/k/a HELVETIA ACCIDENT SWISS INSURANCE COMPANY), IRON TRADES INSURANCE COMPANY LIMITED (f/k/a IRON TRADES MUTUAL INSURANCE COMPANY 4 LIMITED), LA MINERVE INSURANCE COMPANY LIMITED, LOMBARD MARINE & GENERAL INSURANCE COMPANY LTD., LONDON & EDINBURGH GENERAL INSURANCE COMPANY, LONDON & OVERSEAS AVIATION A.C., MOTOR UNION INSURANCE COMPANY LIMITED, NATIONAL CASUALTY COMPANY, NATIONAL CASUALTY COMPANY OF AMERICA, THE NEW INDIA ASSURANCE COMPANY LIMITED, PHOENIX ASSURANCE PUBLIC LIMITED COMPANY, PHOENIX AVIATION INSURANCE COMPANY LIMITED, PHOENIX INSURANCE COMPANY LTD., RIVER THAMES INSURANCE COMPANY LIMITED, ROAD TRANSPORT & GENERAL INSURANCE CO. LTD., ROYAL SCOTTISH ASSURANCE PLC (f/k/a THE ROYAL SCOTTISH INSURANCE COMPANY LIMITED), SCOTTISH LION INSURANCE COMPANY LTD., STRONGHOLD INSURANCE COMPANY LIMITED, SWISS NATIONAL INSURANCE COMPANY LIMITED, SWISS UNION GENERAL INSURANCE COMPANY LIMITED, SWITZERLAND GENERAL INSURANCE COMPANY LIMITED, TRENT INSURANCE COMPANY LIMITED, TUREGUM INSURANCE COMPANY LIMITED, ULSTER INSURANCE COMPANY LIMITED, UMA, UNITED SCOTTISH INSURANCE COMPANY AVIATION LTD., UNITED SCOTTISH INSURANCE COMPANY LIMITED, VANGUARD INSURANCE COMPANY LIMITED, VICTORIA AVIATION, VICTORIA INSURANCE COMPANY, LTD., and THE WORLD MARINE & GENERAL INSURANCE PLC (f/k/a THE WORLD MARINE & GENERAL INSURANCE COMPANY LIMITED), 5 Third-Party Defendants.CONTINENTAL INSURANCE COMPANY, FIDELITY & CASUALTY COMPANY OF NEW YORK, COMMERCIAL INSURANCE COMPANY OF NEWARK, N.J., and COLUMBIA CASUALTY COMPANY, Plaintiffs, v.HONEYWELL INTERNATIONAL, INC. (f/k/a ALLIEDSIGNAL, INC., successor to BENDIX AVIATION CORPORATION and BENDIX CORPORATION), Defendant-Respondent, andST. PAUL FIRE AND MARINE INSURANCE COMPANY, Defendant-Appellant, andAFFILIATED FM INSURANCE COMPANY, ALLSTATE INSURANCE COMPANY, AMERICAN HOME ASSURANCE COMPANY, AMERICAN INSURANCE COMPANY, CALIFORNIA UNION INSURANCE COMPANY, CENTURY INDEMNITY COMPANY, COMMERCIAL UNION INSURANCE COMPANY as successor to EMPLOYERS LIABILITY ASSURANCE CORPORATION, LTD., EMPLOYERS INSURANCE OF WAUSAU, FIREMAN’S FUND INSURANCE COMPANY, GRANITE STATE 6 INSURANCE COMPANY, GREAT AMERICAN INSURANCE COMPANY, HOME INSURANCE COMPANY, INSURANCE COMPANY OF NORTH AMERICA, NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA, NORTH RIVER INSURANCE COMPANY, TRAVELERS INDEMNITY COMPANY, UNDERWRITERS AT LLOYDS LONDON and CERTAIN LONDON MARKET COMPANIES, including ANGLO SAXON INSURANCE ASSOC. LTD., DOMINION INSURANCE COMPANY, DRAKE INSURANCE COMPANY, EAGLE STAR INSURANCE COMPANY, INSTITUTE OF LONDON UNDERWRITERS, LONDON & EDINBURGH INSURANCE COMPANY LTD., PRUDENTIAL ASSURANCE COMPANY LTD., SOUTHERN INSURANCE COMPANY, and WORLD AUXILIARY INSURANCE CORP., LTD., Defendants, andHONEYWELL INTERNATIONAL, INC. (f/k/a ALLIEDSIGNAL, INC., successor to BENDIX AVIATION CORPORATION and BENDIX CORPORATION), Defendant/Third-Party Plaintiff-Respondent, v.TRAVELERS CASUALTY & SURETY COMPANY (f/k/a AETNA CASUALTY & SURETY COMPANY), 7 Third-Party Defendant- Appellant, andAIU INSURANCE COMPANY, AMERICAN CENTENNIAL INSURANCE COMPANY, ASSOCIATED INTERNATIONAL INSURANCE COMPANY, CENTRE INSURANCE COMPANY (f/k/a LONDON GUARANTEE AND ACCIDENT COMPANY OF NEW YORK), CONTINENTAL CASUALTY COMPANY, THE CONTINENTAL INSURANCE COMPANY as successor in interest to HARBOR INSURANCE COMPANY (f/k/a HARBOR INSURANCE COMPANY), EVEREST REINSURANCE COMPANY (f/k/a PRUDENTIAL REINSURANCE COMPANY), EXECUTIVE RISK INDEMNITY INC. (f/k/a AMERICAN EXCESS INSURANCE COMPANY), FEDERAL INSURANCE COMPANY, FIRST STATE INSURANCE COMPANY, FREMONT INDEMNITY COMPANY (f/k/a INDUSTRIAL INDEMNITY COMPANY), GENERAL REINSURANCE CORPORATION, HARTFORD ACCIDENT & INDEMNITY COMPANY, INTERNATIONAL INSURANCE COMPANY (f/k/a INTERNATIONAL SURPLUS LINES INSURANCE COMPANY), LEXINGTON INSURANCE COMPANY, MT. MCKINLEY INSURANCE COMPANY (f/k/a GIBRALTAR CASUALTY COMPANY), MUTUAL FIRE, MAINE & INLAND INSURANCE COMPANY, ROYAL INDEMNITY COMPANY, THE TOKIO MARINE & FIRE INSURANCE COMPANY, LTD., TWIN CITY FIRE INSURANCE COMPANY, UTICA MUTUAL INSURANCE COMPANY, 8 WESTPORT INSURANCE COMPANY (f/k/a PURITAN INSURANCE COMPANY), and CERTAIN LONDON MARKET COMPANIES, including ACCIDENT & CASUALTY INSURANCE COMPANY, ALBA GENERAL INSURANCE COMPANY (f/k/a ALBA GENERAL INSURANCE COMPANY LIMITED), AVIATION & GENERAL INSURANCE COMPANY LIMITED, AXA INSURANCE PLC (f/k/a PROVINCIAL INSURANCE PUBLIC LIMITED COMPANY), THE BRITISH AVIATION INSURANCE COMPANY LIMITED, BRITISH LAW INSURANCE COMPANY LIMITED, BRITISH RESERVE INSURANCE COMPANY LIMITED, BRITISH TRADERS INSURANCE COMPANY LTD., C.A.M.A.T. INSURANCE COMPANY LIMITED, C.F.A.U., CONTINENTAL ASSURANCE COMPANY OF LONDON, LTD., CORNHILL INSURANCE PUBLIC LIMITED COMPANY (f/k/a CORNHILL INSURANCE COMPANY LIMITED), EDINBURGH ASSURANCE COMPANY LTD., EDINBURGH INSURANCE COMPANY LIMITED, EDINBURGH NO. 2 GROUP, ELVIA SWISS INSURANCE COMPANY (f/k/a HELVETIA ACCIDENT INSURANCE COMPANY LIMITED), EXCESS INSURANCE COMPANY LIMITED, FIDELIDADE INSURANCE COMPANY OF LISBON, GE SPECIALITY INSURANCE (UK) LIMITED (f/k/a THREADNEEDLE INSURANCE COMPANY LIMITED), GENERAL INSURANCE COMPANY HELVETIA LIMITED, GROUPAMA INSURANCE COMPANY LIMITED (f/k/a MINISTER INSURANCE COMPANY LIMITED), HELVETIA INSURANCE COMPANY LTD., HELVETIA SWISS INSURANCE COMPANY LIMITED (f/k/a HELVETIA ACCIDENT 9 SWISS INSURANCE COMPANY), IRON TRADES INSURANCE COMPANY LIMITED (f/k/a IRON TRADES MUTUAL INSURANCE COMPANY LIMITED), LA MINERVE INSURANCE COMPANY LIMITED, LOMBARD MARINE & GENERAL INSURANCE COMPANY LTD., LONDON & EDINBURGH GENERAL INSURANCE COMPANY, LONDON & OVERSEAS AVIATION A.C., MOTOR UNION INSURANCE COMPANY LIMITED, NATIONAL CASUALTY COMPANY, NATIONAL CASUALTY COMPANY OF AMERICA, THE NEW INDIA ASSURANCE COMPANY LIMITED, PHOENIX ASSURANCE PUBLIC LIMITED COMPANY, PHOENIX AVIATION INSURANCE COMPANY LIMITED, PHOENIX INSURANCE COMPANY LTD., RIVER THAMES INSURANCE COMPANY LIMITED, ROAD TRANSPORT & GENERAL INSURANCE CO. LTD., ROYAL SCOTTISH ASSURANCE PLC (f/k/a THE ROYAL SCOTTISH INSURANCE COMPANY LIMITED), SCOTTISH LION INSURANCE COMPANY LTD., STRONGHOLD INSURANCE COMPANY LIMITED, SWISS NATIONAL INSURANCE COMPANY LIMITED, SWISS UNION GENERAL INSURANCE COMPANY LIMITED, SWITZERLAND GENERAL INSURANCE COMPANY LIMITED, TRENT INSURANCE COMPANY LIMITED, TUREGUM INSURANCE COMPANY LIMITED, ULSTER INSURANCE COMPANY LIMITED, UMA, UNITED SCOTTISH INSURANCE COMPANY AVIATION LTD., UNITED SCOTTISH INSURANCE COMPANY LIMITED, VANGUARD INSURANCE COMPANY LIMITED, VICTORIA AVIATION, VICTORIA INSURANCE COMPANY, LTD., and THE WORLD MARINE & 10 GENERAL INSURANCE PLC (f/k/a THE WORLD MARINE & GENERAL INSURANCE COMPANY LIMITED), Third-party Defendants. Argued October 24, 2017 – Decided June 27, 2018 On certification to the Superior Court, Appellate Division. Andrew T. Frankel argued the cause for appellants St. Paul Fire and Marine Insurance Company and Travelers Casualty and Surety Company (Windels Marx Lane & Mittendorf, and Simpson Thacher & Bartlett, attorneys; Stefano V. Calogero, of counsel; Stefano V. Calogero, Andrew T. Frankel, Tanya M. Mascarich, on the briefs). Michael J. Lynch (K&L Gates) of the Pennsylvania bar, admitted pro hac vice, argued the cause for respondent Honeywell International, Inc. (K&L Gates, attorneys; Michael J. Lynch, Donald E. Seymour, John T. Waldron, and Donald W. Kiel, on the briefs). Carl A. Salisbury and Paul E. Breene submitted a brief on behalf of amicus curiae United Policyholders (Bramnick, Rodriguez, Grabas, Arnold & Mangan, and Reed Smith, attorneys). Brian R. Ade submitted a brief on behalf of amicus curiae Complex Insurance Claims Litigation Association (Rivkin Radler, attorneys). JUSTICE LaVECCHIA delivered the opinion of the Court. This appeal involves questions about the insurance coverageavailable to defendant Honeywell International, Inc.(Honeywell), a New Jersey based corporation, for thousands ofbodily-injury claims premised on exposure to brake and clutch 11 pads (friction products) containing asbestos. We grantedcertification to address two issues. First, we consider whetherthe law of New Jersey or Michigan (the headquarters location ofHoneywell’s predecessor when the disputed excess insurancepolicies were issued) should control in the allocation ofinsurance liability among insurers for nationwide products-liability claims. Second, we address whether it was error notto require the policyholder, Honeywell, to contribute in theallocation of insurance liability based on the time after whichthe relevant coverage became unavailable in the marketplace(that is, since 1987). In addressing the allocation question, we note thatHoneywell does not seek coverage in this dispute for claims thatinvolve initial product exposure occurring after insurance wasnot available and while the policyholder continued tomanufacture the product. Although some of the claims presentedinvolve injury that manifested after the date of excess-insurance unavailability, the class of claims to be addressed bythe coverage block of insurance all presume that productexposure predated the insurance unavailability. Thus,consistent with New Jersey’s continuous-trigger doctrine,Honeywell is seeking coverage under excess insurance policiesfor claims only from exposure occurrences during the period ofpolicy coverage. 12 Different jurisdictions approach pinpointing the occurrenceof injury using varying methodologies. We, and a majority ofjurisdictions, rely on medical science that teaches asbestos-related disease is progressive, as body tissue is injured whenan individual inhales asbestos fibers. Owens-Illinois, Inc. v.United Ins. Co., 138 N.J. 437, 454 (1994). That concept led toour adoption of the continuous-trigger doctrine in insuranceliability allocation, which assumes progressive injury in eachpolicy year following initial exposure. See ibid. To someextent that determination involves a legal fiction. Id. at 457.However, by allocating responsibility based on the date ofinitial exposure and every policy year thereafter, we maximizethe insurance resources available to claimants suffering bodilyinjury. Under our current law on allocation of liability amonginsurers, an insured is not forced to assume responsibility inthat allocation during the insurance coverage block of policiesfor years in which insurance is not reasonably available forpurchase. Id. at 478-79 (referring to unavailability rule). The trial court and the Appellate Division both concludedthat New Jersey law applied, although for different reasons.Both courts further determined that, under the circumstances,the second question must be answered in the negative. 13 For the reasons that follow, we also hold that New Jerseylaw on the allocation of liability among insurers applies inthis matter, and we set forth the pertinent choice-of-lawprinciples to resolve this dispute over insurance coverage fornumerous products-liability claims. Concerning the second question, on these facts, we alsoaffirm the determination to follow the unavailability exceptionto the continuous-trigger method of allocation set forth inOwens-Illinois. I. The unpublished Appellate Division decision in this matterdistilled the extensive record developed by the trial court. Wedraw from the panel’s summary of the facts and proceduralhistory and credit the panel for its fine work. A. By way of general background, The Bendix Corporation(Bendix) -- a corporate predecessor to defendant Honeywell --for many years manufactured and sold friction products thatcontained asbestos. Bendix stopped using asbestos in itsfriction products in 2001, having continued to manufacture theitems even after 1987 when insurance for asbestos-related claimsfor such products ceased to be available in the marketplace. Beginning around 1975, Bendix began to receive liabilityclaims asserting that asbestos in its friction products caused 14 bodily injury to users. In the years leading up to the summaryjudgment proceedings in this matter, Bendix and its successorsreceived approximately 147,000 claims, of which about 71,000have been resolved. Claimants sued Bendix in almost all fiftystates, and its insurers have spent more than $1 billion onindemnity payments. Certain matters are undisputed. The friction productscontained asbestos. Honeywell is responsible for asbestosliabilities attributed to Bendix, although it disputes thedangerousness of its friction products. And, excess insurancecoverage for asbestos-related personal injury claims becameunavailable for purchase after April 1, 1987. In 2000, Continental Insurance Company (Continental) (whichwrote many primary insurance policies for Bendix during therelevant years), and related companies, commenced this actionseeking declaratory relief concerning the rights and obligationsassociated with insurance coverage for the asbestos-relatedbodily injury claims filed against Honeywell as a corporatesuccessor to Bendix. Bendix advanced cross-claims and third-party claims against various insurers, including TravelersCasualty & Surety Company (Travelers) and St. Paul Fire andMarine Insurance Company (St. Paul). Honeywell settled with Continental and most other insurers.The ten insurance policies that remain at issue involve excess 15 insurance issued to Bendix by Travelers and St. Paul. Eight ofthe policies were issued to Bendix by Travelers’s predecessor,Aetna Casualty & Surety Company (Aetna). Two of the policieswere issued by St. Paul. St. Paul was since acquired byTravelers but is separately identified for purposes of thisappeal. The choice-of-law issue in this matter arose from thefollowing procedural actions. Honeywell filed a motion forpartial summary judgment in 2006, asking the court to apply NewJersey insurance allocation law while opposing the applicationof Michigan law. Travelers opposed Honeywell’s motion and fileda cross-motion, seeking the application of Michigan law to itspolicies. St. Paul did not oppose Honeywell’s motion or make aseparate motion. The motion judge granted Honeywell’s motion,denied Travelers’s cross-motion, and held that the laws of NewJersey would apply to the insurance allocation questions. Thecourt memorialized its order on November 9, 2006. With that general background in mind, we turn to some finerdetails. B. Bendix was incorporated in 1929 under the laws of the Stateof Delaware. Aspects of its business took place in differentstates. During the course of its corporate existence, Bendixhad manufacturing operations in all fifty states and twenty-two 16 foreign countries, and sold its products throughout the UnitedStates. Administratively though, from about 1940 to 1969,Bendix maintained its headquarters in South Bend, Indiana, whilealso having central offices in Detroit and New York. Itsinsurance office was in South Bend. Between 1969 and 1983,Bendix situated its executive headquarters, including itsinsurance office, in Michigan; another central office was in NewYork. Bendix also had significant contacts with New Jersey.Until 1973, Bendix’s largest center of operations and payrollwas in New Jersey. Bendix had a variety of businesses, spanning such areas asautomotive products, aerospace products, industrial products,financial services, and others. Included among its products arethose at the center of the claims at issue here: frictionproducts. Bendix and its successors manufactured asbestos products inNew York from 1939 until 2001 and in Tennessee from 1965 through2001. As noted, asbestos ceased to be used as a component ofthe friction products in 2001. Honeywell is the corporate successor to Bendix as a resultof the following corporate changes. The Allied Corporation(Allied) acquired Bendix in 1983 and operated it as a whollyowned subsidiary, assuming Bendix’s obligations and liabilities.Allied was incorporated under the laws of the State of New York 17 and had its principal place of business in New Jersey. In 1985,Allied and Signal Companies merged, becoming wholly-ownedsubsidiaries of The Allied-Signal Inc., a new Delawarecorporation that also has been headquartered in New Jersey sincethe merger. The Allied-Signal Inc. changed its name toAlliedSignal Inc. in 1993; AlliedSignal Inc. merged withHoneywell, Inc., in December of 1999 and changed its name toHoneywell. Honeywell was incorporated under the laws of theState of Delaware, but its headquarters and principal place ofbusiness have always been located in Morristown, New Jersey. Since 1983, all insurance operations for Bendix and itssuccessors have been located in New Jersey. In total, Honeywellhas purchased more than $3.5 billion in umbrella and excessinsurance for Bendix’s and its successors’ liabilities frominsurers whose principal places of business were located in overfourteen states and countries, including New Jersey. It appears not to be disputed that the excess insurancepolicies, which were not subject to settlement before the trialcourt, were all brokered, issued, and delivered to Bendix inMichigan. Travelers’s predecessor, Aetna, issued its disputedpolicies to Bendix between 1977 and 1983; St. Paul issued itsdisputed policies between 1968 and 1970. None of the policiescontain a choice-of-law provision governing the allocation issuebefore us. 18 C. As noted, the trial court granted Honeywell’s motion forpartial summary judgment in 2006, holding that New Jerseyinsurance-allocation law would apply in this matter. When, in 2011, the motion court addressed motions forpartial summary judgment that involved the dispute over theduration of the coverage block of insurance, the parties wereeleven years into the case. The parties asked the court toconsider resolving six issues as a matter of law, as well as toappoint a special allocation master as Owens-Illinois suggestedwould be appropriate for complicated, long tail, asbestos-injury-claims cases. The duration of the coverage block teed up the issue of theunavailability rule’s application in this matter. All partiesagreed that the beginning point would be 1940. Continental, theprimary insurer for many years, started paying out claims in the1980s, before Owens-Illinois was decided in 1994. It had someyears in which its policy had no upper limit. Consistent withpromoting the interests of its insured, it began paying claimsfor claimants and to assist Bendix and its successors in theresolution of claims, leaving coverage disputes to be resolvedindependently. Eventually, Continental assigned to Honeywellits rights with respect to the primary’s responsibilities underallocation. That assignment included the considerable 19 complication that its records made it difficult to determine howContinental had been variously assigning costs (i.e., defensecosts or liability costs and to which matter), which affectedthe order of exhaustion of policies among insurers. As therecord highlights, between 1980 and 1994, Continental’sassignment of past defense costs was unclear and, once thosecosts could be identified, required assessment in respect of theallocation theory to be applied to this matter. That and otherissues were implicated in this complicated matter of insuranceliability allocation that was the essence of the complaint inthis matter. The trial court determined that one law on allocationshould apply and that should be New Jersey law. That approachallowed the court to use one set of rules to sensibly andcoherently allocate responsibility among insurers, over decadesof actions, and the many payments already made by insurers, aswell as the insured, depending on the policy-imposed obligationsand coverage limitations held to apply. And, the court’sdetermination was consistent with previous decisions thatrecognized that Owens-Illinois could be applied retroactively,including for defense costs. See Champion Dyeing & FinishingCo. v. Centennial Ins. Co., 355 N.J. Super. 262, 270-71 (App.Div. 2002); see generally Chem. Leaman Tank Lines, Inc. v. Aetna 20 Cas. & Sur. Co., 177 F.3d 210, 229-31 (3d Cir. 1999) (applyingOwens-Illinois retroactively). The determination of the coverage block was immenselyimportant to the continued resolution of the issues. The Owens-Illinois allocation methodology, simply described, looks at thetime on the risk horizontally and the total limits in eachannual period vertically. Thus, an endpoint to the coverageblock of insurance to be divvied up for claims and defense costsis essential to the calculation and to the assignment of risk tobe borne by primary insurers and exhausted in each policy yearbefore the excess insurer is tapped for its contributions forthat year. Owens-Illinois utilizes that allocation approach,recognizing also a continuous-trigger doctrine to explain thebasis for recognizing occurrences in the year of first exposureto asbestos and in each subsequent policy year. To avoid havingits insurance triggered, an insurer has the burden of showingthat exposure did not occur earlier or during the policy yearfor which it wrote coverage for the insured. Otherwise,manifestation of injury presenting itself thereafter resulted inallocation of that individual’s claim, in accordance withmathematical formulae, to that insurer’s policy year. It was within the context of that setting and law that themotion court considered the parties arguments over the duration 21 of the coverage block. Travelers (taking the lead in argument)and St. Paul, both excess insurers, argued that the coverageblock should run until the year in which Honeywell, as thesuccessor to Bendix, ceased manufacturing the friction products–- 2001. Honeywell maintained that the coverage block shouldend in the 1986-87 period when first primary (1986) and thenexcess (April 1, 1987) insurance ceased to be available. To theexcess insurers, Honeywell was arguing for truncating theinsurance coverage block. To Honeywell, Travelers was arguingfor extenuation of the insurance coverage block. The unavailability rule’s application in this case became apoint of debate. Travelers asserted earlier in this matter thata fact question existed about whether insurance was available inthe marketplace. In 2007, another motion judge ordereddiscovery and a hearing on that question. When the presentlydiscussed motion for partial summary judgment came before thedeciding motion judge, the court concluded that there was nogenuine issue of fact concerning the question. The court heldthat commercial policies were not available to Honeywellbeginning with the 1986/87 period as it had maintained, and wenote that fact determination is not challenged in this appeal. As a result of the discovery that had taken place though,Travelers also argued, in connection with the partial summaryjudgment motion, that Honeywell was self-insured. In advancing 22 that argument, it pointed to the company’s maintenance ofcorporate reserves. Travelers further argued that Honeywell hadassumed the risk and should be treated as responsible for theyears that it continued to manufacture friction products after1987 until 2001 -- another fifteen years, which would reduce theexposure of the excess carriers in the allocation methodologyform that which would occur under a coverage block that ended in1987. With respect to the reserves, the trial court dismissed theargument that maintenance of reserves is the equivalent of self-insurance. The court also rejected the argument that somehowthat business practice of maintaining reserves represented anassumption of insurance risk relevant to resolution of thecoverage block dispute. The focal point to the argument and decision by the courtwas the unavailability rule application, or not, to determiningtriggered years of insurance for purposes of allocation underthe Owens-Illinois paradigm. On that point, the court heard from Travelers the argumentsthat continued manufacturing by Honeywell from 1987 to 2001increased the number of pre-1987 exposure claims, increased thepotential value of pre-1987 claims by alleged enhanced injuryfrom continued exposure, and resulted in encouraging more peopleto file claims based on pre-1987 exposure. 23 Honeywell argued that the record lacked factual or expertevidence to support those assertions of inference. Moreover,Honeywell emphasized that Owens-Illinois allocation theoryaddressed assumption of insurance risk not assumption of tortrisk. Ultimately, the trial court agreed with Honeywell that theinsurance coverage period should not be extended, as Travelersrequested, to include years from 1987 to 2001. Applying Owens-Illinois’s approach to allocation of insurance risk to claimsarising exclusively from pre-1987 initial exposure, the courtdetermined that the unavailability of commercial insuranceshould end the coverage block of insurance. Hence, the decisionfixed with certainty the policies, with their specific terms andamounts, that were available for the special master to considerwhen allocating among insurers and Honeywell for that period oftime alone. That July 22, 2011 decision had the result of notrequiring the court, or anyone else, to attempt to determine howpolicy amounts or limits or related insurance concerns for post-1987 years would be overlaid on Honeywell during the 1987-2001period when manufacturing continued or how such corporatefinances would be sorted out between post- and pre-1987 claims. After the parties consented to the appointment of a specialallocation master (SAM), this matter proceeded before the SAMwith policy years, policies, and amounts certain for the period 24 of 1940-1987 as he addressed the already complicated issuesbefore him. As the SAM’s initial report to the trial courtclearly noted before delving into the difficult issues assignedto him, [a] Bendix asbestos claim triggers those policies issued to Bendix and/or Honeywell that were in effect during the portion of the Trigger Period that is within the coverage block. Exposure to an asbestos product shall be presumed to be exposure to a Bendix product, with the burden shifting to each insurer to prove that there was no exposure to a Bendix product before or during its policy period. There is no coverage under a policy where the claimant’s first exposure to asbestos from a Bendix product takes place after the effective period of a given policy expired. After holding hearings and hearing argument, the SAM issueda report and supplemental report containing recommendations onallocation. The trial court adopted the SAM’s recommendations,with one exception not relevant to this appeal, and entered afinal judgment on September 16, 2013. By the time this matterreached appellate processes, almost all claims had settled. D. Travelers and St. Paul jointly appealed the trial court’stwo orders to the Appellate Division. They appealed theNovember 9, 2006 order, which granted Honeywell’s partialsummary judgment motion and applied New Jersey allocation law,and the July 22, 2011 order, which granted Honeywell’s partial 25 summary judgment motion and held that Honeywell had noallocation responsibility because after 1987 it was not able toobtain insurance coverage for asbestos claims. The AppellateDivision affirmed the trial court but required a limited remandnot pertinent to this appeal. The appellate panel considered the trial court’s choice-of-allocation-law ruling only as applied to Travelers’s eightexcess policies.1 In its substantive review of that question,the panel determined that there was a conflict between theinsurance-allocation methodologies of New Jersey, as determinedby Owens-Illinois, and the Michigan time-on-the-riskmethodology, espoused by the Michigan Court of Appeals in ArcoIndustries Corp. v. American Motorists Insurance Co., 594 N.W.2d 61 (Mich. Ct. App. 1998) (Arco), aff’d by an equally dividedcourt, 617 N.W.2d 330 (Mich. 2000). The appellate panel foundinapplicable the Restatement (Second) of Conflict of Laws (Am.Law Inst. 1971) (Restatement) § 193, entitled “Contracts ofFire, Surety or Casualty Insurance,” because its site-specificapproach was inconsistent with Travelers’s nationwide insurancepolicies and Bendix’s selling of the friction products1 Because St. Paul had not filed a motion before the trial court for the application of Michigan law and did not oppose Honeywell’s motion asking the court to apply New Jersey law, its policies were not considered by the panel for purposes of this first issue. 26 throughout the United States. The appellate panel insteadanalyzed the issue through Restatement §§ 188 and 6. The panelparticularly relied on the § 6 factors, as distilled by thisCourt in Pfizer, Inc. v. Employers Insurance, 154 N.J. 187, 198-99 (1998). The appellate panel considered the public policyinterests of both states; the interests of commerce among thestates; the interests of the parties, including an evaluation ofwhere the insurance policies were brokered, negotiated,underwritten, and issued; and the interest of judicialadministration. Ultimately, the panel agreed with the trialcourt and concluded that the choice-of-law analysis supportedthe application of New Jersey law to Travelers’s eight excesspolicies, which were in effect between February 1, 1977 andOctober 1, 1983. The appellate panel further agreed with the trial courtthat, under Owens-Illinois, Honeywell was not required tocontribute to allocation for pre-1987 initial exposure claimseven if the claimant did not manifest injury until after 1987,given that excess insurance for asbestos-related claims was notreasonably available for purchase after 1987. St. Paul and Travelers petitioned this Court forcertification, raising both the choice-of-law and allocationissues. We granted their petition. 228 N.J. 437 (2016). II. 27 Turning first to the choice-of-law question, the partiesdisagree on the outcome of the first step in that inquiry:whether a true conflict exists. Travelers contends there is adifference in the methodologies of the two states. Honeywell,on the other hand, maintains that Michigan has not clearlyadopted a set methodology and, so, it has no policy with whichNew Jersey’s methodology can be said to conflict. Assuming there is a conflict requiring a choice-of-lawdetermination, the parties differ as to the proper analyticapproach and the outcome. Travelers asks this Court to resolve and clarify therelationship between Restatement §§ 193 and 188 and our priordecisions and focuses in particular on State Farm MutualAutomobile Insurance Co. v. Estate of Simmons, 84 N.J. 28(1980). Travelers acknowledges that our law has moved from alex-loci-contractus approach toward a most-significant-relationship approach in contract disputes. However, Travelersemphasizes that the law of the place of the contract ordinarily governs the choice of law because [that] rule will generally comport with the reasonable expectations of the parties concerning the principal situs of the insured risk during the term of the policy and will furnish needed certainty and consistency in the selection of the applicable law. [(quoting Simmons, 84 N.J. at 37).] 28 Travelers maintains that we have directly addressed choice-of-contract-law questions only in the context of environmentalcoverage disputes and not in circumstances akin to those presenthere, where a products-liability case has resulted in claimsacross the nation. It argues that New Jersey’s site-specificchoice-of-law approach for environmental disputes is not wellsuited for products-liability cases in which insurance contractdisputes arise. Here, Travelers maintains that, because the insurancecontracts at issue were brokered, negotiated, underwritten,issued, and delivered to Bendix in Michigan, the presumptionunder Simmons and Restatement § 193 in favor of application ofthe law of the place of contract should result in a presumptiveapplication of Michigan law in this matter. Travelers assertsthat no state has an interest that overcomes, in this instance,the presumption that a court should apply the laws of the siteof contracting. Honeywell disagrees that Simmons’s purported presumption --that the site of the place of contract is of paramountimportance -- is applicable in these circumstances. It arguesthat we have rejected adopting the law of the site of thecontract as the presumptive law and urges consideration of thecomparative interests of the respective states. Here, Honeywellurges application of the Restatement § 6 factors, as distilled 29 in Pfizer. Applying those factors, Honeywell argues that therelative interests of Michigan are minimal compared to theinterests of New Jersey. We reserve a more granular discussion about the § 6factors, as they pertain in this matter, for our later analysis. III. We begin with familiar terrain. Choice-of-law questionsinvolve legal determinations, and therefore our review is denovo. McCarrell v. Hoffmann-La Roche, Inc., 227 N.J. 569, 583-84 (2017). Furthermore, when a civil action is brought in NewJersey, we use New Jersey choice-of-law rules to decide whetherthis state’s or another state’s legal framework should beapplied. Id. at 583. A. The first step in a conflicts analysis is to decide whetherthere is an actual conflict between the laws of the states withinterests in the litigation. P.V. ex rel. T.V. v. Camp Jaycee,197 N.J. 132, 143 (2008). “If there is no actual conflict, thenthe choice-of-law question is inconsequential, and the forumstate applies its own law to resolve the disputed issue.” Rowev. Hoffman-LaRoche, Inc., 189 N.J. 615, 621 (2007). A conflictof law requires a “substantive difference” between the laws ofthe interested states. DeMarco v. Stoddard, 223 N.J. 363, 383(2015). A “substantive difference” is one that “is offensive or 30 repugnant to the public policy of this State.” Ibid.; see alsoMcCarrell, 227 N.J. at 584 (noting statute of limitationsdifference was “outcome determinative” to question beforeCourt). Here, we agree with the appellate panel’s determinationthat there is a substantive difference between the New Jerseyand Michigan approaches to determining the allocation ofliability between manufacturers and insurers for injuries thatprogress after exposure to an allegedly toxic substance. 1. New Jersey law employs the continuous-trigger doctrine, asinitially adopted by this Court in our seminal case on insuranceallocation, Owens-Illinois, 138 N.J. 437. In Owens-Illinois, we held “that when progressiveindivisible injury or damage results from exposure to injuriousconditions for which civil liability may be imposed, courts mayreasonably treat the progressive injury or damage as anoccurrence within each of the years of [the insurance] policy.”Id. at 478. We acknowledged that “injury may mean differentthings in different contexts” and that “the point at which thelaw will say that injury requires indemnity” is not “easilyunderstandable.” Id. at 457. “In that sense,” we noted, “theconcept of injury, like the related concepts of duty andcausation, is an instrument of policy.” Ibid. We reviewed theapproaches taken by other jurisdictions to that same question, 31 id. at 459-68, and ultimately settled on the continuous-triggertheory of liability as a matter of compelling public policy, id.at 478. We held that “courts may reasonably treat theprogressive injury or damage as an occurrence within each of theyears of a CGL [(comprehensive general liability insurance)]policy.” Ibid. Given that the continuous-trigger theory would implicatemultiple insurance policies, we also adopted a methodology forallocating liability among those policies. Id. at 474-75.Under that approach, when determining an insurer’s liability, acourt is to consider both the insurer’s time on the risk and thedegree of risk that insurer assumed. Ibid. That entails“proration on the basis of policy limits, multiplied by years ofcoverage.” Id. at 475. Several policy rationales were at work in the Owens-Illinois approach. See id. at 472-76. Our decision identifiedthe goals sought to be achieved through the designatedallocation approach. Specifically, we sought to (1) “make themost efficient use of the resources available to cope withenvironmental disease or damage,” id. at 472; (2) encourage“responsible conduct that will increase, not decrease, availableresources,” ibid.; (3) spread risk among multiple insurers, id.at 472-73; (4) encourage policyholders to purchase coverage 32 every year, ibid.; and (5) serve “principles of simple justice,”id. at 473. It bears repeating here, as we emphasized then, that thetheory underlying insurance is risk allocation. Id. at 472.“Because insurance companies can spread costs throughout anindustry and thus achieve cost efficiency, the law should, at aminimum, not provide disincentives to parties to acquireinsurance when available to cover their risks. Spreading therisk is conceptually more efficient.” Id. at 472-73. We saidthat an insurance allocation scheme that spreads coststhroughout the industry and promotes an efficient use ofresources translates to more money available to respond in theevent of disease and damage. Id. at 478. This Court has continued to emphasize those public interesteffects when, for example, extending the allocation principlesto include excess insurance in its methodology. See Carter-Wallace, Inc. v. Admiral Ins. Co., 154 N.J. 312, 325-27 (1998)(rejecting excess insurers’ horizontal exhaustion theory andadopting vertical loss allocation by year as keeping with policyprinciples of Owens-Illinois); see also Spaulding CompositesCo., Inc. v. Aetna Cas. & Sur. Co., 176 N.J. 25, 39-42 (2003)(reinforcing primacy of Owens-Illinois’s policy goals whenrejecting enforcement of non-cumulation clause in CGL policy). 33 In sum, we have in New Jersey a longstanding allocationapproach built on a continuous-trigger theory premised on thenotion that asbestos and other progressive environmentalinjuries are multiple occurrences and must be treated as such.See Benjamin Moore & Co. v. Aetna Cas. & Sur. Co., 179 N.J. 87,104 (2004) (“The multiple occurrence template is a matter ofsubstance that is at the heart of Owens-Illinois.”). Ourmethodology for determining allocation of liability amonginsurers whose policies cover asbestos-related diseases over aperiod of years considers both the insurers’ time on the riskand the degree of risk assumed. Insurers do not share a singleloss under that methodology; rather, each is made responsiblefor losses on its watch, subject to the limits of the policyeach has written, “as calculated in accordance with a formula wedeveloped as a proxy for a scientific assessment of the amountof injury happening at each phase on the continuum.” Id. at105. 2. Michigan utilizes a different allocation method. A pro rata allocation theory based on a “time-on-the-risk”methodology was adopted by the intermediate Court of Appeals inArco, 594 N.W 2d at 68-69.2 That approach “allocates liability2 We acknowledge the argument that Michigan does not have a settled policy because of a Michigan Court of Appeals decision 34 among triggered policies using the periods covered by eachinsurer without considering the coverage limits of the triggeredpolicies.” Id. at 68. Although a majority of the MichiganSupreme Court did not vote to affirm Arco, lending it“diminished precedential value,” In re Martin, 602 N.W.2d 630,632 n.2 (Mich. Ct. App. 1999), Arco remains precedentialnonetheless, see Mich. Ct. R. 7.215(J)(1); see also Stoner v.N.Y. Life Ins. Co., 311 U.S. 464 , 467 (1940) (holding thatfederal courts in diversity jurisdiction cases “must follow thedecisions of intermediate state courts in the absence ofconvincing evidence that the highest court of the state woulddecide differently”).3 Importantly, in Arco, the Michigan Court of Appealsspecifically considered and rejected the Owens-Illinoisapproach, concluding that the policy considerations articulatedthat conflicts with Arco. To support that position, Honeywell cites to a subsequent unpublished Court of Appeals opinion that adopted an “all sums” method of allocation, mandating that the insurers must pay all of the insured’s liability without temporal limitations. However, unpublished decisions in Michigan are not precedential and not binding, see Mich. Ct. R. 7.215(C)(1), and therefore such opinions cannot affect our analysis in this case. 3 Notably, other courts regard Michigan as applying a pro rata allocation method that employs the time-on-the-risk approach. See Decker Mfg. Corp. v. Travelers Indem. Co., 106 F. Supp. 3d 892, 895 (W.D. Mich. 2015); Alticor, Inc. v. Nat’l Union Fire Ins. Co. of Pa., 916 F. Supp. 2d 813, 832-33 (W.D. Mich. 2013); Century Indem. Co. v. Aero-Motive Co., 318 F. Supp. 2d 530 , 545 (W.D. Mich. 2003). 35 by commentators weighed in favor of adopting the time-on-the-risk method: The time-on-the-risk method should be adopted by courts because its inherent simplicity promotes predictability, reduces incentives to litigate, and ultimately reduces premium rates. Courts can easily administer the time- on-the-risk method. Once a court determines the scope of the progressive injury, that is, the total damage[,] . . . it can readily allocate the damages among the triggered policies. . . . Unlike the Owens-Illinois method, the effects of deductibles, excess insurance, and self-insurance are easy to calculate by pretending that the policy’s share of damages was the damage that actually occurred during that policy period. . . . . The simplicity of the time-on-the-risk method removes many of the incentives to litigate the allocation of damages. Since the parties will know in advance how the court will allocate liability, there is much less of the uncertainty that encourages wasteful litigation. . . . In addition to decreasing the amount of litigation, this method provides a way for insurance companies to estimate more accurately total expected liability; as a result premiums should decline. . . . Because this method, unlike the Owens-Illinois method, does not rely on a case-by-case determination of how much coverage was purchased, it also obviates the concern about inconsistent application. [Arco, 594 N.W 2d at 69 (first and fifth ellipses in original) (quoting Michael G. 36 Doherty, Allocating Progressive Injury Liability Among Successive Insurance Policies, 64 U. Chi. L. Rev. 257, 281-83 (1997)).] In sum, a substantive difference separates the New Jerseyand Michigan legal approaches and policy considerations for theinsurance allocation question at issue, and so we must engage ina choice-of-law analysis for determining which state’sallocation framework applies. To that question we now turn. B. 1. Turning to New Jersey’s rules on conflicts of laws in thesetting of insurance contracts and multiple claimants, we begin,as urged by Travelers, with Simmons, because that case markedthe beginning of this Court’s modernization of conflicts law. Our Court rejected the former choice-of-law rules of lexloci contractus (for insurance contracts), see Simmons, 84 N.J.at 36-37, and lex loci delicti (for torts), see Veazey v.Doremus, 103 N.J. 244, 247-49 (1986), in favor of using a moreflexible “governmental interest” standard that comes from theRestatement. When we took that step in Simmons, the choice-of-law question involved the limits of automobile insurancecoverage issued in Alabama to an Alabama insured who, shortlyafter temporarily relocating to New Jersey, became involved in a 37 car accident in New Jersey. 84 N.J. at 30. In Simmons, theCourt held that when the judiciary is called on to determinechoice-of-law principles in the context of interpreting an“automobile liability insurance contract, the law of the placeof the contract will govern the determination . . . unless thedominant and significant relationship of another state to theparties and the underlying issue dictates that this basic ruleshould yield.” Id. at 37. We ultimately found no cogent reasonnot to follow Alabama law on automobile liability insurance inthe resolution of the claims in the litigation. Id. at 38. In explaining the proper conflict-of-law analysis whenmultiple parties and insurers were involved, our Court statedthat the proper approach in resolving conflict-of-law issues in liability insurance contract controversies . . . in both the contract field as well as in the somewhat related tort field . . . calls for recognition of the rule that the law of the place of the contract ordinarily governs the choice of law because this rule will generally comport with the reasonable expectations of the parties concerning the principal situs of the insured risk during the term of the policy and will furnish needed certainty and consistency in the selection of the applicable law. [Id. at 37.] 2. In Simmons, we relied on § 193 of the Restatement. Id. at35-36, 57. Section 193, addressing conflicts of law in the 38 specific setting of contracts of fire, surety or casualtyinsurance, provides that [t]he validity of a contract of fire, surety or casualty insurance and the rights created thereby are determined by the local law of the state which the parties understood was to be the principal location of the insured risk during the term of the policy, unless with respect to the particular issue, some other state has a more significant relationship under the principles stated in § 6 to the transaction and the parties, in which event the local law of the other state will be applied. Since Simmons, this Court has continued to confrontconflict-of-law questions concerning insurance coverage incomplex settings involving mass torts. In those subsequentcases, we have discussed the role of two other pertinentRestatement provisions that warrant identification beforeproceeding to review those cases. Section 188 of the Restatement generally addressesconflicts-of-law determinations in contract settings where theparties have not made an effective choice of law. It providesthat “[t]he rights and duties of the parties with respect to anissue in contract are determined by the local law of the statewhich, with respect to that issue, has the most significantrelationship to the transaction and the parties under [the § 6factors].” More specifically, subparagraph (2) of § 188 39 identifies the contacts to be considered when applying the § 6factors. They are: (a) The place of contracting, (b) The place of negotiation of the contract, (c) The place of performance, (d) The location of the subject matter of the contract, and (e) The domicil, residence, nationality, place of incorporation and place of business of the parties. Section 6 of the Restatement sets forth several genericconflicts-of-law principles. In particular, it sets forth thefactors that are relevant in a conflicts determination whenthere is no local statutory directive controlling the issue.Specifically, Section 6 provides: [T]he factors relevant to the choice of the applicable rule of law include (a) the needs of the interstate and international systems, (b) the relevant policies of the forum, (c) the relevant policies of other interested states and the relative interests of those states in the determination of the particular issue, (d) the protection of justified expectations, (e) the basic policies underlying the particular field of law, (f) certainty, predictability and uniformity of result, and 40 (g) ease in the determination and application of the law to be applied. With those additional Restatement sections in mind, we turnback to review our case law in this area. 3. In Gilbert Spruance Co. v. Pennsylvania Manufacturers’Ass’n Insurance Co., 134 N.J. 96, 97 (1993), we consideredchoice of law regarding insurance coverage in the context of amass tort. Specifically, we granted certification to address“whether a comprehensive general liability policy containing apollution exclusion, issued by an out-of-state carrier andcovering an out-of-state defendant’s operations, should beconstrued pursuant to New Jersey law.” Ibid. Ultimately, weaffirmed the Appellate Division’s holding that when it isreasonably foreseeable to parties to an insurance contract thata New Jersey waste site will obtain the insured’s wasteproducts, our substantive law dictates the interpretation of theinsurance agreement because New Jersey “had the dominantsignificant relationship.” Id. at 98. In Spruance, the plaintiff company (Spruance), aPennsylvania corporation, manufactured paint products inPhiladelphia and, in the 1970s and 1980s, “consigned its wasteto independent waste haulers, who transported the waste to [dumpsites] in New Jersey.” Ibid. Four of those sites formed “the 41 basis of multiple toxic-tort claims for personal injury andproperty damage,” which led New Jersey’s then-Department ofEnvironmental Protection to bring public remediation andenforcement actions. Ibid. During the pertinent period,Spruance had negotiated and purchased primary and excessinsurance policies in Pennsylvania from a Pennsylvaniacorporation, covering plant operations in numerous states. Id.at 98-99. The policies contained a pollution-exclusion clause;accordingly, when Spruance submitted notice of claims arisingfrom the New Jersey waste sites, the insurance carrierdisclaimed coverage based on the exclusion. Id. at 99.Spruance filed a declaratory judgment action in New Jersey onthe coverage question, and New Jersey courts had to determinewhether Pennsylvania or New Jersey law applied to theinterpretation of the pollution-exclusion clause. Ibid. In considering the conflicts-of-law question when thematter reached our Court, we restated our rejection of a“mechanical and inflexible lex loci contractus rule in resolvingconflict-of-law issues in liability-insurance contracts,” andreferenced our “more flexible approach that focuses on the statethat has the most significant connections with the parties andthe transaction.” Id. at 102. We noted that when determiningthe conflicts-of-law rule to govern casualty-insurancecontracts, Restatement § 193 usually is initially consulted; 42 however, we concluded that § 193 did not provide a satisfactoryframework for the fact-specific question presented, explainingthat [i]f the principal location of the insured risk is in a single state for a major portion of the insurance period, that location “is the most important contact to be considered in the choice of the applicable law, at least as to most issues.” However, the location of the risk has less significance when a movable risk is concerned or when “the policy covers a group of risks that are scattered throughout two or more states.” [Id. at 104 (quoting Restatement § 193 cmt. b).]In such factual settings, we recognized that a clearunderstanding about the principal location of the insured riskwould not necessarily be present and so a different approach waswarranted: [W]hen the “subject matter of the insurance is an operation or activity” and when “that operation or activity is predictably multistate, the significance of the principal location of the insured risk diminishes” . . . [and] the governing law is that of the state with the dominant significant relationship according to the principles set forth in Restatement section 6. [Id. at 112 (quoting Gilbert Spruance Co. v. Pa. Mfrs.’ Ass’n Ins. Co., 254 N.J. Super. 43, 50 (App. Div. 1992)).] Spruance broke from the prior reliance on the place of thecontract in Simmons. Rather, we determined that the Restatement§§ 188 and 6 provided a more useful framework for addressing the 43 various interests at stake. We determined those Restatementsections to be analytically more appropriate “in the context ofcommercial insurance and pollution exclusion involving out-of-state waste generation, multi-state waste generation, and in-state waste generation with the waste ultimately coming to restin New Jersey.” Spruance, 134 N.J. at 104. Spruance’s reach has been the subject of debate. Even wehave commented that [c]ourts have found it “tempting” to extract from Spruance a “bright-line rule” of applying the law of the state in which the waste disposal site is located as long as it was reasonably foreseeable to the contracting parties that the insured’s waste would predictably come to rest in that state. [Pfizer, 154 N.J. at 197.]However, as clarified in Pfizer, “there is no way to avoid acareful site-specific determination, made upon a completerecord.” Ibid. (quotation marks omitted). When the risk is “tosome degree transient,” a court must use the Restatement § 6factors in its analysis. Ibid. (quoting Spruance, 134 N.J. at 113). In Pfizer, this Court did that. In that case, the Court relied on the factors in § 6,informed by reasoning from General Ceramics, Inc. v. Firemen’sFund Insurance Cos., 66 F.3d 647 (3d Cir. 1995), to articulatethe interests to be considered in an environmental toxic tortsetting when the location of the damage is ascertainable. Id. 44 at 197-98. Although condensed and reframed into four inquiries,the Pfizer analysis nevertheless remained tethered to thesection 6 factors: 1. The competing interests of the states[, which] require courts to consider whether application of a competing state’s law under the circumstances of the case “will advance the policies that the law was intended to promote[;]” . . . 2. The interests of commerce among the states[, which] require courts to consider whether application of a competing state’s law would frustrate the policies of other states[;] . . . 3. The interests of parties[, which] require courts to focus on their justified expectations and their needs for predictability of result[;] . . . [and] 4. The interests of judicial administration[, which] require a court to consider whether the fair, just and timely disposition of controversies within the available resources of courts will be fostered by the competing law chosen. [ 154 N.J. at 198-99 (quoting Gen. Ceramics, 66 F.3d at 656).] The Pfizer Court explained that, in considering thecompeting interests of the states, the inquiry should focus “on'what [policies] the legislature or court intended to protect byhaving [the] law apply to wholly domestic concerns, and then,whether those concerns will be furthered by applying that law tothe multi-state situation.’” Id. at 198 (first alteration inoriginal) (quoting Gen. Ceramics, 66 F.3d at 656). The Court 45 also noted that the “contacts” outlined in § 188 are relevant inorder to “assess[] what parties might reasonably have expectedto be predictable.” Id. at 199; see also HM Holdings, Inc. v.Aetna Cas. & Sur. Co., 154 N.J. 208, 213-17 (1998) (applyingPfizer analysis to multiple choice-of-law questions inenvironmental-coverage dispute). With that background, we turn to the conflict-of-law issuebefore us. C. 1. To begin, we reject the insurers’ argument that Simmonsrequires this analysis to begin with Restatement § 193 and itspresumption that the law of the place of contracting applies.We no longer follow lex loci contractus for insurance contractsand Simmons is factually distinct from this dispute. Simmonsbegan with a presumption in favor of the law of the contractingstate in an automobile-insurance-liability dispute, which wassensible in light of that state’s relationship with the“principal situs of the insured risk.” 84 N.J. at 37; see alsoRestatement § 193. Neither Simmons nor § 193 persuasivelypertain in circumstances such as we have here: nationwideproducts-liability claims spanning many years of productexposure rather than a single occurrence event. 46 Indeed, in Spruance, we clarified that “the location of the[insured] risk has less significance when a moveable risk isconcerned or when 'the policy covers a group of risks that arescattered throughout two or more states.’” 134 N.J. at 104(quoting Restatement § 193 cmt. b). The insurance policies atissue here covered a scattered risk, insuring Bendix forliability related to a commercial product that the manufacturerdistributed nationally. Unlike an environmental-coverage case,the insurers were not insuring a risk site. Michigan, as theplace of contracting, did not relate to a risk site. In a contract dispute over insurance allocation fornationwide products liability claims asserting bodily injury dueto asbestos exposure, neither Restatement § 193 nor Simmonsprovides the proper starting point. The conflicts analysis hereshould center on Restatement §§ 188 and 6, as our laterdecisions in Spruance and Pfizer have taught. 2. Section 188 sets forth the contacts to be taken intoaccount in applying the principles of § 6. Section 6’s factors,to the extent helpfully condensed in our Pfizer decision, fillout the inquiry. With respect to the § 188 contacts with the states havingan interest in the question of substantive law, not all of thecontacts are of equal importance or value in this fact-specific 47 inquiry. Having already abandoned the place of contracting(here Michigan) as the presumptive starting point, we adhere tothe observation in Restatement § 188 cmt. e. on subsection (2),that “[s]tanding alone, the place of contracting is a relativelyinsignificant contact.” That is particularly true where, ashere, the insured risk is not site-specific. The place ofnegotiation (again Michigan) can be of importance, as recognizedin the Restatement’s comment to § 188. However, two stronger considerations under § 188, appliedto this matter, combine to point toward New Jersey. Here, theplace of performance, § 188(c), and the domicile, residence, andplaces of incorporation and of business of the parties,§ 188(e), all point to New Jersey. The latter takes intoaccount enduring characteristics and deserves to be a startingpoint in the analysis. Further, heavy weight must be given tothe nature of the insured risk and its site, or to an otherwiseperformance-related location consideration. New Jersey is thelongstanding domicile of the insured in this litigation (since1983). Honeywell is the successor to the rights of Bendix underthe insurance contract. As such, Honeywell’s place of domicileand business (New Jersey) is easily determined at the timecoverage is invoked due to litigation, triggering the terms ofthe insurance contract for these products liability claims.Relatedly, New Jersey is also the place of performance for the 48 contractual defense and indemnification of Honeywell in thislitigation involving long-tail claims on an occurrence policyfor a predecessor’s products cast into the national marketplace.Even before the New Jersey-based Honeywell became the successorto Bendix, New Jersey was integrally involved in Bendix’sbusiness operations. It is no stranger to the dispute. With those contacts in mind, we turn to the Restatement’sfactors in section 6, helpfully condensed in Pfizer, for ouranalytical framework. The question is whether New Jersey’srelationship with the case is sufficiently significant towarrant application of New Jersey law. In examining the competing interests of the states, thefirst inquiry described in Pfizer consolidates several § 6factors and asks, simply, whether application of the competingstates’ laws would advance the policy interests that the law wasintended to promote. Owens-Illinois is very clearly a policy-driven opinion,identifying several policies sought to be promoted throughapplication of our allocation methodology for progressive bodilyinjury claims based on asbestos exposure. Honeywell contendsthat application of the Owens-Illinois approach in this matterwill promote those policies. We generally agree. The policiesof maximizing insurance resources, encouraging the spreading ofrisk throughout the insurance industry, promoting the purchase 49 of insurance when available, and considerations of simplejustice all are important to this state. Owens-Illinois andCarter-Wallace focused on those policies. Fulfilling them willbenefit the State because they achieve worthy goals enhancingthe interests of a New Jersey insured, and the claimants whowere injured by progressive asbestos-related disease, bymaximizing insurance resources and prompting insureds to obtainand maintain insurance coverage. To the extent that Michigan’s time-on-the-risk approachalso seeks to benefit insureds and claimants, application of NewJersey’s allocation law will not undermine those Michiganinterests. Moreover, it is far from clear what interestMichigan has in insisting that its allocation methodology applyin this insurance dispute, which no longer involves a Michigan-based company. Finally, although New Jersey’s interest in the “efficientuse of the resources available to cope with environmentaldisease or damage,” Owens-Illinois, 138 N.J. at 472, may be lesscompelling in a products-liability case where the harm is notconfined to New Jersey, the State’s interest in “simple justice”will be advanced when the Travelers policies are subjected tothe same New Jersey law as the St. Paul policies. In sum, we do not see a strong Michigan interest in itsallocation law being applied to this coverage dispute. This 50 matter involves nationwide products-liability claims relating toitems manufactured in virtually all fifty states andinternationally, sold in the national marketplace, and that noware the liability of a successor, New Jersey-based corporation. The second Pfizer factor considers commerce between thestates. That factor is analytically similar to the prior one.It too supports application of New Jersey law. The inquiryfocuses on “whether application of a competing state’s law wouldfrustrate the policies of other states.” Pfizer, 154 N.J. at 198. In addition to the competing interests of the statesalready discussed, the public policy goals further identified inArco are prospective in nature. The Michigan Court of Appealssought to promote predictability, discourage litigation, andreduce premiums. Arco, 594 N.W 2d at 70. Application ofMichigan’s time-on-the-risk method in this instance cannotdiscourage litigation among these parties. Further, it wouldnot promote predictability. As the Appellate Division noted,neither Bendix nor its insurers could have anticipated at thetime of contracting that Michigan would adopt that allocationmethod, which was not yet part of Michigan’s law. The third factor considers the interests of the parties.Here the contacts outlined in § 188 of the Restatement come tothe fore. Courts look to the parties’ justified expectations 51 and need for predictability, as well as the other contactsoutlined in § 188. Travelers asserts that Michigan law shouldgovern because Michigan was the place of contracting. However,as the Appellate Division noted, when the parties entered thenow-disputed excess insurance policies, they could not havereasonably anticipated the later adoption of the time-on-the-risk approach in Michigan. The parties did know though that theTravelers policies covered risk related to products that Bendixsold nationwide. The risk was not stationary; it extendedbeyond Michigan’s borders. We are unpersuaded by Travelers’scontention that the parties expected Michigan allocation law togovern. That said, we acknowledge that, at the time of contracting,the parties could not have expected New Jersey law to controleither. However, section 188 directs courts to consider, amongother factors, the place of performance, Restatement § 188(c),and the place of business of the parties, id. § 188(e). Wealready determined that we view those two contacts as strongestin the resolution of this dispute and both point toward NewJersey. We give great weight in this analysis to Honeywell’sstatus as a New Jersey corporation responsible for liability forasbestos-related claims based on pre-1987 exposure to itsfriction products. We conclude that this factor supportsapplication of New Jersey allocation law. 52 Finally, we look at the interests of judicialadministration under the last Pfizer factor, which asks “whatchoice of law works best to manage adjudication of thecontroversy before the court.” 154 N.J. at 199. In Owens-Illinois, we designed special procedures for the resolution ofallocation disputes in cases involving long-tail losses. 138 N.J. at 477-78. The Court placed its faith in the discretion ofskilled masters and encouraged “the use of special casecalendars, management conferences, monitoring, [and] alternativemethods of dispute resolution.” Ibid. We agree with the Appellate Division that Pfizer’s “specialjudicial framework” will best manage adjudication of thisdispute. Travelers contends that procedural complexity will notserve the interests of judicial administration and arguesinstead for the simpler time-on-the-risk approach, whichrequires fewer resources. That argument fails to persuade,however, because the fourth factor focuses not only on resourceuse but also on “best manage[ment]” of the case. New Jersey’ssystem is well suited to resolve a complex allocationcontroversy in a fair manner. In sum, we conclude, in this contract setting where noprovision of the contract or of state law compels application ofa specific state’s law, that conflicts-of-law principles favorapplication of New Jersey allocation law in the present dispute 53 over liability among insurers. Accordingly, for the reasonsexpressed, we affirm the Appellate Division on the first issueand turn to the second, questioning the use of ourunavailability exception in that allocation methodology. IV. The continuous-trigger and related unavailability exceptiontheories for allocation of insurance liability have beenrecognized and applied in this state since the 1994 decision inOwens-Illinois. As previously discussed, in that matter, whichinvolved toxic-exposure to asbestos, we addressed the use ofpollution-exclusion clauses in insurance policies and theirimpact on the policyholder. After considering strong policyarguments presented by all parties, we settled on thecontinuous-trigger doctrine and its related allocationmethodology as being best for purposes of assessing liabilityand promoting risk management. 138 N.J. at 478-79. Wedetermined to use that method of allocation of liability becausewe found it superior by virtue of (1) encouraging theacquisition of insurance and spreading costs throughout theindustry; (2) promoting the efficient use of insurance resourcesto make more money available to respond in catastrophiccircumstances; (3) compelling insurers to minimize their costs;and (4) advancing principles of simple justice. Id. at 472-78. 54 The continuous-trigger method assumes the availability ofinsurance and incorporates recognition of an unavailabilityexception. As we explained in Owens-Illinois, “[w]hen periodsof no insurance reflect a decision by an actor to assume orretain a risk, as opposed to periods when coverage for a risk isnot available, to expect the risk-bearer to share in theallocation is reasonable.” Id. at 479. The Court thus made itclear that a policyholder is not responsible for the pro rataportion of liability that reflects a period of insuranceunavailability. Id. at 479. Courts have applied the“unavailability exception,” in accordance with the language ofOwens-Illinois, to require an insured to share in an allocationof liability under the continuous-trigger doctrine only when itforegoes purchasing available insurance. See Farmers Mut. FireIns. Co. of Salem v. N.J. Prop.-Liab. Ins. Guar. Ass’n, 215 N.J. 522, 538-39 (2013) (collecting cases); Champion Dyeing, 355 N.J.Super. at 276-77. A. In this appeal, St. Paul and Travelers ask this Court tocreate an equitable exception to the unavailability rule,whereby corporations that continue to manufacture products afterinsurance becomes unavailable for those products would bedeprived of the insurance coverage they purchased prior to thatunavailability. The insurers contend that the Appellate 55 Division misapplied this Court’s precedent when it heldHoneywell was entitled to coverage, asserting that the panel’sapplication of Owens-Illinois conflicts with the public policyobjectives underpinning that decision. They urge us to concludethat Honeywell’s decision to continue to manufacture and sellproducts containing asbestos, after insurance was no longeravailable, should result in requiring Honeywell to contribute tothe losses from its past and future sale of those products.They urge the Court to find an “exceptional circumstance”warranting departure from Owens-Illinois in this case. Thus,they claim that, for purposes of performing the allocation ofrisk, the coverage block of insurance should have been extendedto include all years that Honeywell continued to manufacture thefriction products. They assert that, otherwise, application ofthe unavailability rule will encourage manufacturers to behaveirresponsibly. Manufacturers, they argue, will be allowed totransfer the risk of that subsequent (post-insuranceunavailability) conduct to their prior insurers. They do notask for this Court to overrule Owens-Illinois and itsunavailability exception in the allocation methodology, butargue about its application to the facts of this case. Joining with the insurers, as amicus curiae, is the ComplexInsurance Claims Litigation Association (CICLA). CICLA’s mainargument is that this Court should abandon the unavailability 56 doctrine altogether, an argument not raised by the insurersthemselves. CICLA claims a trend in the law of otherjurisdictions away from recognition of an unavailabilityexception. CICLA contends that the exception undermines thepublic policy objectives that support the allocation methodologyof Owens-Illinois and encourages manufacturers to foregoinsurance while continuing to produce and sell potentiallydangerous products. CICLA adds that the unavailabilityexception complicates insurance coverage litigation by creatingadditional issues requiring expanded discovery. In contrast, Honeywell primarily points to the record thatestablishes that excess insurance was no longer available afterApril 1987. Honeywell emphasizes that it is seeking coverageonly for claims alleging first exposure to a Bendix productbefore 1987 -- while Bendix and its successors had activeoccurrence-policy coverage for asbestos-based risks -- even ifmanifestation occurred after that point in time. Honeywellstresses that, under existing law, their conduct after 1987 isnot relevant because it does not affect the prior exposure forwhich they had purchased insurance. Thus, Honeywell contends,the Owens-Illinois unavailability rule was applied correctly andconsistently with the policy objectives expressed in thatopinion. Honeywell underscores that it is inaccurate for theinsurers to contend that it is seeking to foist post-1987 57 conduct onto insurers. In the alternative, Honeywell contendsthat its adversaries misread Owens-Illinois to allow forliability allocation to an insured for a time when insurance wasunavailable. United Policyholders (UP), appearing as amicus curiae insupport of Honeywell, argues that the trial court and AppellateDivision appropriately applied the Owens-Illinois unavailabilityexception. UP notes that, in Owens-Illinois, the Court focusedon the policyholder’s conscious decision to forego the purchaseof available insurance rather than the policyholder’s decisionto engage in a particular kind of business activity. In fact,UP contends, in Owens-Illinois the Court expressly contrasted aspecific decision by an actor to assume or retain a risk duringa period of no insurance with those periods when insurancecoverage is not available. It too emphasizes that the recordclearly establishes that excess-insurance coverage for asbestosrisk was not available after 1987. UP further urges that we notabandon precedent because Owens-Illinois has offered certaintyin its formula and has encouraged settlement of complex coveragedisputes. B. We have affirmed that the continuous-trigger theory ofliability is the law of this state multiple times since thedecision in Owens-Illinois. For example, in Benjamin Moore, we 58 reiterated our policy principles and noted that “[t]he multipleoccurrence template is a matter of substance that is at theheart of Owens-Illinois.” 179 N.J. at 104. The theory triggers multiple policies, thus maximizing resources available for toxic tort cases. It is what encourages the purchase of insurance. It is what voids “other insurance” clauses. It is what makes “non-cumulation” clauses inapplicable. It is what requires a calculation of the loss that occurred during each policy period. It is our effort to regularize the essentially irregular progressive environmental damage case and make it amenable to disposition in accordance with the undertakings in the insurance contract. [Id. at 104-05.]Most importantly, as discussed previously, the theory holdsinsurers responsible for the losses that actually occur on theirwatch, using a formula that approximates “a scientificassessment of the amount of injury,” even if the actual injurymanifests later. Id. at 105. We have articulated thoseprinciples in a number of settings. See, e.g., Spaulding, 176 N.J. 25; Quincy Mut. Fire Ins. Co. v. Borough of Bellmawr, 172 N.J. 409 (2002); Carter-Wallace, 154 N.J. 312. On appeal, the policy implications of the unavailabilityrule has been a focus of an amici that seeks the totalelimination of the unavailability exception. Travelers alsomaintains that assumption of tort risk should factor into theestablishment of a coverage block, eliminating application of 59 the unavailability rule when a company continues to manufacturea product after commercial insurance is no longer available. Clearly, the law on allocation methodology differs amongthe states. Other states have adopted policies different fromthe “continuous-trigger” and “unavailability exception” theoriesembraced by New Jersey. See, e.g., Arceneaux v. Amstar Corp.,200 So. 3d 277, 287-88 (La. 2016); KeySpan Gas E. Corp. v.Munich Reins. Am., Inc., 96 N.E.3d 209, 214-16 (N.Y. 2018);Bradford Oil Co. v. Stonington Ins. Co., 54 A.3d 983, 991-92(Vt. 2011). In the debate over the suitability of adopting anOwens-Illinois approach, the discussions are noticeably context-dependent.4 No doubt, legitimate policy reasons may have led sistercourts to reach diverse conclusions regarding each one’sallocation analysis and whether an unavailability exception is4 Indeed, not all cases line up as reviewing progressing injury from asbestos or other harmful substances, but instead arise in alternate contexts, such as interpretation of traditional pollution exclusion clauses. See, e.g., Md. Cas. Co. v. W.R. Grace & Co., 794 F. Supp. 1206 , 1229 (S.D.N.Y. 1991) (“One would not usually associate asbestos with the substances listed in the exclusion, namely, smoke, fumes or waste. Those substances bear a closer relation to industrial pollution, the usual subject of the ordinary pollution exclusion.” (citation omitted)); Pub. Serv. Co. v. Wallis & Cos., 986 P.2d 924 , 939-40, 943 (Colo. 1999) (rejecting continuous-trigger theory in pollution context); Am. Bumper & Mfg. Co. v. Hartford Fire Ins. Co., 550 N.W.2d 475 , 484 (Mich. 1996) (declining to adopt either occurrence-manifestation theory or continuous-trigger theory). 60 sensible in a particular scheme. Compare Sybron TransitionCorp. v. Sec. Ins. of Hartford, 258 F.3d 595, 599-600 (7th Cir.2001) (commenting on idea that insurance can be “available” or“unavailable”), and Crossmann Cmtys. of N.C., Inc. v.Harleysville Mut. Ins. Co., 717 S.E.2d 589, 594-95, 599-601(S.C. 2011) (adopting “time-on-risk” approach to “forward[]important policy goals” and preserve incentive for business topurchase sufficient insurance, promoting stability in insurancemarket), with R.T. Vanderbilt Co. v. Hartford Accident & Indem.Co., 156 A.3d 539, 573-74 (Conn. App. Ct.) (adopting continuous-trigger theory in asbestos case because substance immediatelyinjures body following exposure and theory accounts for unknownsin progression of disease, and continuous-trigger analysis is“the fairest and most efficient way to distribute indemnity anddefense costs”), certif. granted, 171 A.3d 62; 171 A.3d 63(Conn. 2017). In Owens-Illinois we acknowledged that “[i]f, afterexperience, we are convinced that our solution is inefficient orunrealistic, we will not hesitate to revisit” the allocationparadigm with its continuous-trigger and unavailabilitydoctrines. 138 N.J. at 478. This appeal, however, does notpresent a compelling vehicle to reconsider our precedent onallocation. It specifically does not present a proper factual 61 basis to revisit the unavailability rule that is part of thecoherent principles that comprise our allocation methodology. The record in this appeal, carefully addressed by the trialcourt, indisputably demonstrates when insurance becameunavailable in the marketplace. Importantly, none of theinitial asbestos exposures, on which claims Honeywell is seekinginsurance coverage, occurred after insurance became unavailable.The claimants initially were exposed to asbestos at times whenthe manufacturer was covered by the excess insurance policies atissue. Although the disputed policies involved in this appealconcern excess insurance, we are dealing with occurrencepolicies. Further, we are addressing claims pertaining toexposure to asbestos during the policy periods claimed to havecaused progressive asbestos-related disease. See Owens-Illinois, 138 N.J. at 454 (confirming injury to body tissueoccurs on inhalation through exposure to asbestos fibers). This case simply does not present facts on which toconsider abandoning the unavailability exception, let alonewhether to create a novel equitable exception to that exceptionthat would retroactively deprive parties of paid-for insurancecoverage due to their post-coverage-period conduct. Sufficientjustification for even contemplating taking steps to alter ourallocation methodology, with its unavailability rule, is absenthere. The continued application of the unavailability rule 62 supports the public policy objectives originally intended by ourprorated allocation methodology. For the reasons that preceded in this opinion’s discussionof the trial court’s motion practice, we agree with theAppellate Division that the trial court correctly kept its focuson whether Honeywell could reasonably have purchased insurancefor asbestos-related claims. The assumption-of-risk language inOwens-Illinois, in context, addressed only assumption of aninsurance risk for the existing claim periods when insurance wasreasonably available but the insured elected not to purchase it.That is not what has happened here. Moreover, we decline toupend this long-litigated dispute to recognize here an equitableexception to the unavailability rule. In light of the extended litigation and the fact that themanufacturer ceased producing these friction products seventeenyears ago, we decline to disrupt the coverage block of insurancefixed by the trial court, which resulted in maximizing theinsurance resources available for claimants. Indeed, the basicpolicy objectives of Owens-Illinois -- of maximizing insuranceresources, encouraging the spreading of risk throughout theinsurance industry, promoting the purchase of insurance whenavailable, and of simple justice -- are all served by affirmingthe judgment and moving to closure this mammoth allocationdispute, going back to 1940 through to the ending of insurance 63 availability in 1987. Further, we reject that this holding willdisincentivize manufacturers from responsible behavior regardingproducts for which insurance becomes unavailable, for whateverreason may be discernable. This manufacturer ceased itsproduction. Our affirmance of the insurance coverage blockestablished in this matter is rooted in the overall recordbefore us. To the extent that our dissenting colleague woulduse this case to have this matter address alterations to thecontinuous-trigger concept as it was originally fashioned, andto the Owens-Illinois allocation paradigm, in order to promotesocial policy regarding tort law, that invitation is not onethat these circumstances compel us to accept. V. The judgment of the Appellate Division is affirmed. CHIEF JUSTICE RABNER and JUSTICES FERNANDEZ-VINA, SOLOMON, and TIMPONE join in JUSTICE LaVECCHIA’s opinion. JUSTICE ALBIN filed an opinion, dissenting in part. JUSTICE PATTERSON did not participate. 64 SUPREME COURT OF NEW JERSEY A- 21 September Term 2016 078152CONTINENTAL INSURANCE COMPANY, FIDELITY & CASUALTY COMPANY OF NEW YORK, COMMERCIAL INSURANCE COMPANY OF NEWARK, N.J., and COLUMBIA CASUALTY COMPANY, Plaintiffs, v.HONEYWELL INTERNATIONAL, INC. (f/k/a ALLIEDSIGNAL, INC., successor to BENDIX AVIATION CORPORATION and BENDIX CORPORATION), Defendant-Respondent, andST. PAUL FIRE AND MARINE INSURANCE COMPANY, Defendant-Appellant, andAFFILIATED FM INSURANCE COMPANY, ALLSTATE INSURANCE COMPANY, AMERICAN HOME ASSURANCE COMPANY, AMERICAN INSURANCE COMPANY, CALIFORNIA UNION INSURANCE COMPANY, CENTURY INDEMNITY COMPANY, COMMERCIAL UNION INSURANCE COMPANY as successor to EMPLOYERS LIABILITY ASSURANCE CORPORATION, LTD., EMPLOYERS INSURANCE OF WAUSAU, FIREMAN’S FUND INSURANCE COMPANY, GRANITE STATE 1 INSURANCE COMPANY, GREAT AMERICAN INSURANCE COMPANY, HOME INSURANCE COMPANY, INSURANCE COMPANY OF NORTH AMERICA, NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA, NORTH RIVER INSURANCE COMPANY, TRAVELERS INDEMNITY COMPANY, UNDERWRITERS AT LLOYDS LONDON and CERTAIN LONDON MARKET COMPANIES, including ANGLO SAXON INSURANCE ASSOC. LTD., DOMINION INSURANCE COMPANY, DRAKE INSURANCE COMPANY, EAGLE STAR INSURANCE COMPANY, INSTITUTE OF LONDON UNDERWRITERS, LONDON & EDINBURGH INSURANCE COMPANY LTD., PRUDENTIAL ASSURANCE COMPANY LTD., SOUTHERN INSURANCE COMPANY, and WORLD AUXILIARY INSURANCE CORP., LTD., Defendants, andHONEYWELL INTERNATIONAL, INC. (f/k/a ALLIEDSIGNAL, INC., successor to BENDIX AVIATION CORPORATION and BENDIX CORPORATION), Defendant/Third-Party Plaintiff-Respondent, v.TRAVELERS CASUALTY & SURETY COMPANY (f/k/a AETNA CASUALTY & SURETY COMPANY), Third-Party Defendant- Appellant, 2 andAIU INSURANCE COMPANY, AMERICAN CENTENNIAL INSURANCE COMPANY, ASSOCIATED INTERNATIONAL INSURANCE COMPANY, CENTRE INSURANCE COMPANY (f/k/a LONDON GUARANTEE AND ACCIDENT COMPANY OF NEW YORK), CONTINENTAL CASUALTY COMPANY, THE CONTINENTAL INSURANCE COMPANY as successor in interest to HARBOR INSURANCE COMPANY (f/k/a HARBOR INSURANCE COMPANY), EVEREST REINSURANCE COMPANY (f/k/a PRUDENTIAL REINSURANCE COMPANY), EXECUTIVE RISK INDEMNITY INC. (f/k/a AMERICAN EXCESS INSURANCE COMPANY), FEDERAL INSURANCE COMPANY, FIRST STATE INSURANCE COMPANY, FREMONT INDEMNITY COMPANY (f/k/a INDUSTRIAL INDEMNITY COMPANY), GENERAL REINSURANCE CORPORATION, HARTFORD ACCIDENT & INDEMNITY COMPANY, INTERNATIONAL INSURANCE COMPANY (f/k/a INTERNATIONAL SURPLUS LINES INSURANCE COMPANY), LEXINGTON INSURANCE COMPANY, MT. MCKINLEY INSURANCE COMPANY (f/k/a GIBRALTAR CASUALTY COMPANY), MUTUAL FIRE, MAINE & INLAND INSURANCE COMPANY, ROYAL INDEMNITY COMPANY, THE TOKIO MARINE & FIRE INSURANCE COMPANY, LTD., TWIN CITY FIRE INSURANCE COMPANY, UTICA MUTUAL INSURANCE COMPANY, WESTPORT INSURANCE COMPANY (f/k/a PURITAN INSURANCE COMPANY), and CERTAIN LONDON MARKET COMPANIES, including 3 ACCIDENT & CASUALTY INSURANCE COMPANY, ALBA GENERAL INSURANCE COMPANY (f/k/a ALBA GENERAL INSURANCE COMPANY LIMITED), AVIATION & GENERAL INSURANCE COMPANY LIMITED, AXA INSURANCE PLC (f/k/a PROVINCIAL INSURANCE PUBLIC LIMITED COMPANY), THE BRITISH AVIATION INSURANCE COMPANY LIMITED, BRITISH LAW INSURANCE COMPANY LIMITED, BRITISH RESERVE INSURANCE COMPANY LIMITED, BRITISH TRADERS INSURANCE COMPANY LTD., C.A.M.A.T. INSURANCE COMPANY LIMITED, C.F.A.U., CONTINENTAL ASSURANCE COMPANY OF LONDON, LTD., CORNHILL INSURANCE PUBLIC LIMITED COMPANY (f/k/a CORNHILL INSURANCE COMPANY LIMITED), EDINBURGH ASSURANCE COMPANY LTD., EDINBURGH INSURANCE COMPANY LIMITED, EDINBURGH NO. 2 GROUP, ELVIA SWISS INSURANCE COMPANY (f/k/a HELVETIA ACCIDENT INSURANCE COMPANY LIMITED), EXCESS INSURANCE COMPANY LIMITED, FIDELIDADE INSURANCE COMPANY OF LISBON, GE SPECIALTY INSURANCE (UK) LIMITED (f/k/a THREADNEEDLE INSURANCE COMPANY LIMITED), GENERAL INSURANCE COMPANY HELVETIA LIMITED, GROUPAMA INSURANCE COMPANY LIMITED (f/k/a MINISTER INSURANCE COMPANY LIMITED), HELVETIA INSURANCE COMPANY LTD., HELVETIA SWISS INSURANCE COMPANY LIMITED (f/k/a HELVETIA ACCIDENT SWISS INSURANCE COMPANY), IRON TRADES INSURANCE COMPANY LIMITED (f/k/a IRON TRADES MUTUAL INSURANCE COMPANY 4 LIMITED), LA MINERVE INSURANCE COMPANY LIMITED, LOMBARD MARINE & GENERAL INSURANCE COMPANY LTD., LONDON & EDINBURGH GENERAL INSURANCE COMPANY, LONDON & OVERSEAS AVIATION A.C., MOTOR UNION INSURANCE COMPANY LIMITED, NATIONAL CASUALTY COMPANY, NATIONAL CASUALTY COMPANY OF AMERICA, THE NEW INDIA ASSURANCE COMPANY LIMITED, PHOENIX ASSURANCE PUBLIC LIMITED COMPANY, PHOENIX AVIATION INSURANCE COMPANY LIMITED, PHOENIX INSURANCE COMPANY LTD., RIVER THAMES INSURANCE COMPANY LIMITED, ROAD TRANSPORT & GENERAL INSURANCE CO. LTD., ROYAL SCOTTISH ASSURANCE PLC (f/k/a THE ROYAL SCOTTISH INSURANCE COMPANY LIMITED), SCOTTISH LION INSURANCE COMPANY LTD., STRONGHOLD INSURANCE COMPANY LIMITED, SWISS NATIONAL INSURANCE COMPANY LIMITED, SWISS UNION GENERAL INSURANCE COMPANY LIMITED, SWITZERLAND GENERAL INSURANCE COMPANY LIMITED, TRENT INSURANCE COMPANY LIMITED, TUREGUM INSURANCE COMPANY LIMITED, ULSTER INSURANCE COMPANY LIMITED, UMA, UNITED SCOTTISH INSURANCE COMPANY AVIATION LTD., UNITED SCOTTISH INSURANCE COMPANY LIMITED, VANGUARD INSURANCE COMPANY LIMITED, VICTORIA AVIATION, VICTORIA INSURANCE COMPANY, LTD., and THE WORLD MARINE & GENERAL INSURANCE PLC (f/k/a THE WORLD MARINE & GENERAL INSURANCE COMPANY LIMITED), 5 Third-Party Defendants.CONTINENTAL INSURANCE COMPANY, FIDELITY & CASUALTY COMPANY OF NEW YORK, COMMERCIAL INSURANCE COMPANY OF NEWARK, N.J., and COLUMBIA CASUALTY COMPANY, Plaintiffs, v.HONEYWELL INTERNATIONAL, INC. (f/k/a ALLIEDSIGNAL, INC., successor to BENDIX AVIATION CORPORATION and BENDIX CORPORATION), Defendant-Respondent, andST. PAUL FIRE AND MARINE INSURANCE COMPANY, Defendant-Appellant, andAFFILIATED FM INSURANCE COMPANY, ALLSTATE INSURANCE COMPANY, AMERICAN HOME ASSURANCE COMPANY, AMERICAN INSURANCE COMPANY, CALIFORNIA UNION INSURANCE COMPANY, CENTURY INDEMNITY COMPANY, COMMERCIAL UNION INSURANCE COMPANY as successor to EMPLOYERS LIABILITY ASSURANCE CORPORATION, LTD., EMPLOYERS INSURANCE OF WAUSAU, FIREMAN’S FUND INSURANCE COMPANY, GRANITE STATE 6 INSURANCE COMPANY, GREAT AMERICAN INSURANCE COMPANY, HOME INSURANCE COMPANY, INSURANCE COMPANY OF NORTH AMERICA, NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA, NORTH RIVER INSURANCE COMPANY, TRAVELERS INDEMNITY COMPANY, UNDERWRITERS AT LLOYDS LONDON and CERTAIN LONDON MARKET COMPANIES, including ANGLO SAXON INSURANCE ASSOC. LTD., DOMINION INSURANCE COMPANY, DRAKE INSURANCE COMPANY, EAGLE STAR INSURANCE COMPANY, INSTITUTE OF LONDON UNDERWRITERS, LONDON & EDINBURGH INSURANCE COMPANY LTD., PRUDENTIAL ASSURANCE COMPANY LTD., SOUTHERN INSURANCE COMPANY, and WORLD AUXILIARY INSURANCE CORP., LTD., Defendants, andHONEYWELL INTERNATIONAL, INC. (f/k/a ALLIEDSIGNAL, INC., successor to BENDIX AVIATION CORPORATION and BENDIX CORPORATION), Defendant/Third-Party Plaintiff-Respondent, v.TRAVELERS CASUALTY & SURETY COMPANY (f/k/a AETNA CASUALTY & SURETY COMPANY), 7 Third-Party Defendant- Appellant, andAIU INSURANCE COMPANY, AMERICAN CENTENNIAL INSURANCE COMPANY, ASSOCIATED INTERNATIONAL INSURANCE COMPANY, CENTRE INSURANCE COMPANY (f/k/a LONDON GUARANTEE AND ACCIDENT COMPANY OF NEW YORK), CONTINENTAL CASUALTY COMPANY, THE CONTINENTAL INSURANCE COMPANY as successor in interest to HARBOR INSURANCE COMPANY (f/k/a HARBOR INSURANCE COMPANY), EVEREST REINSURANCE COMPANY (f/k/a PRUDENTIAL REINSURANCE COMPANY), EXECUTIVE RISK INDEMNITY INC. (f/k/a AMERICAN EXCESS INSURANCE COMPANY), FEDERAL INSURANCE COMPANY, FIRST STATE INSURANCE COMPANY, FREMONT INDEMNITY COMPANY (f/k/a INDUSTRIAL INDEMNITY COMPANY), GENERAL REINSURANCE CORPORATION, HARTFORD ACCIDENT & INDEMNITY COMPANY, INTERNATIONAL INSURANCE COMPANY (f/k/a INTERNATIONAL SURPLUS LINES INSURANCE COMPANY), LEXINGTON INSURANCE COMPANY, MT. MCKINLEY INSURANCE COMPANY (f/k/a GIBRALTAR CASUALTY COMPANY), MUTUAL FIRE, MAINE & INLAND INSURANCE COMPANY, ROYAL INDEMNITY COMPANY, THE TOKIO MARINE & FIRE INSURANCE COMPANY, LTD., TWIN CITY FIRE INSURANCE COMPANY, UTICA MUTUAL INSURANCE COMPANY, 8 WESTPORT INSURANCE COMPANY (f/k/a PURITAN INSURANCE COMPANY), and CERTAIN LONDON MARKET COMPANIES, including ACCIDENT & CASUALTY INSURANCE COMPANY, ALBA GENERAL INSURANCE COMPANY (f/k/a ALBA GENERAL INSURANCE COMPANY LIMITED), AVIATION & GENERAL INSURANCE COMPANY LIMITED, AXA INSURANCE PLC (f/k/a PROVINCIAL INSURANCE PUBLIC LIMITED COMPANY), THE BRITISH AVIATION INSURANCE COMPANY LIMITED, BRITISH LAW INSURANCE COMPANY LIMITED, BRITISH RESERVE INSURANCE COMPANY LIMITED, BRITISH TRADERS INSURANCE COMPANY LTD., C.A.M.A.T. INSURANCE COMPANY LIMITED, C.F.A.U., CONTINENTAL ASSURANCE COMPANY OF LONDON, LTD., CORNHILL INSURANCE PUBLIC LIMITED COMPANY (f/k/a CORNHILL INSURANCE COMPANY LIMITED), EDINBURGH ASSURANCE COMPANY LTD., EDINBURGH INSURANCE COMPANY LIMITED, EDINBURGH NO. 2 GROUP, ELVIA SWISS INSURANCE COMPANY (f/k/a HELVETIA ACCIDENT INSURANCE COMPANY LIMITED), EXCESS INSURANCE COMPANY LIMITED, FIDELIDADE INSURANCE COMPANY OF LISBON, GE SPECIALITY INSURANCE (UK) LIMITED (f/k/a THREADNEEDLE INSURANCE COMPANY LIMITED), GENERAL INSURANCE COMPANY HELVETIA LIMITED, GROUPAMA INSURANCE COMPANY LIMITED (f/k/a MINISTER INSURANCE COMPANY LIMITED), HELVETIA INSURANCE COMPANY LTD., HELVETIA SWISS INSURANCE COMPANY LIMITED (f/k/a HELVETIA ACCIDENT 9 SWISS INSURANCE COMPANY), IRON TRADES INSURANCE COMPANY LIMITED (f/k/a IRON TRADES MUTUAL INSURANCE COMPANY LIMITED), LA MINERVE INSURANCE COMPANY LIMITED, LOMBARD MARINE & GENERAL INSURANCE COMPANY LTD., LONDON & EDINBURGH GENERAL INSURANCE COMPANY, LONDON & OVERSEAS AVIATION A.C., MOTOR UNION INSURANCE COMPANY LIMITED, NATIONAL CASUALTY COMPANY, NATIONAL CASUALTY COMPANY OF AMERICA, THE NEW INDIA ASSURANCE COMPANY LIMITED, PHOENIX ASSURANCE PUBLIC LIMITED COMPANY, PHOENIX AVIATION INSURANCE COMPANY LIMITED, PHOENIX INSURANCE COMPANY LTD., RIVER THAMES INSURANCE COMPANY LIMITED, ROAD TRANSPORT & GENERAL INSURANCE CO. LTD., ROYAL SCOTTISH ASSURANCE PLC (f/k/a THE ROYAL SCOTTISH INSURANCE COMPANY LIMITED), SCOTTISH LION INSURANCE COMPANY LTD., STRONGHOLD INSURANCE COMPANY LIMITED, SWISS NATIONAL INSURANCE COMPANY LIMITED, SWISS UNION GENERAL INSURANCE COMPANY LIMITED, SWITZERLAND GENERAL INSURANCE COMPANY LIMITED, TRENT INSURANCE COMPANY LIMITED, TUREGUM INSURANCE COMPANY LIMITED, ULSTER INSURANCE COMPANY LIMITED, UMA, UNITED SCOTTISH INSURANCE COMPANY AVIATION LTD., UNITED SCOTTISH INSURANCE COMPANY LIMITED, VANGUARD INSURANCE COMPANY LIMITED, VICTORIA AVIATION, VICTORIA INSURANCE COMPANY, LTD., and THE WORLD MARINE & 10 GENERAL INSURANCE PLC (f/k/a THE WORLD MARINE & GENERAL INSURANCE COMPANY LIMITED), Third-party Defendants. JUSTICE ALBIN, dissenting in part. This Court is the steward of the common law, charged withthe responsibility of developing legal principles that willpromote fairness and good public policy in our system ofjustice. Today’s majority opinion is at odds with that charge.The majority has taken a single obscure phrase in Owens-Illinois, Inc. v. United Insurance Co., 138 N.J. 437, 479(1994), to perpetuate a doctrine that incentivizes corporationsto manufacture products that are dangerous, and even lethal, tothe mechanics and others who work with them. As applied here, the judicially created doctrine known asthe “unavailability exception” gives a corporation a free passif it continues to expose workers to extremely dangerousproducts after insurance coverage becomes unavailable. Underthe unavailability exception, this Court compels insurancecarriers that previously insured the corporation -- but laterrefuse to do so -- to remain the guarantors for claims arisingduring the years the corporation continues to manufacture itsdangerous products. This misguided application of the doctrinedoes not further notions of fairness or a rational publicpolicy, as is evident from this case. 11 Since 1940, The Bendix Corporation (Bendix)1 securedinsurance coverage for the brake and clutch pads it manufacturedand sold. Those brake and clutch pads contained asbestos, adangerous substance, which if inhaled by a worker can causevarious respiratory diseases and even increase the risk ofdeveloping certain cancers -- diseases that result many times indeath. See Centers for Disease Control and Prevention, HealthEffects of Asbestos, https://www.atsdr.cdc.gov/asbestos/health_effects_asbestos.html (last updated Nov. 3, 2016).Beginning in 1975, Bendix faced asbestos-related personal-injuryclaims from individuals across the country. By 1987, there wereover 2,600 claims filed against Bendix for injuries allegedlycaused by the asbestos-containing brake and clutch pads. Then,in 1988 alone, the number of claims soared to more than 3,600.2 By 1985, the Centers for Disease Control and Prevention(CDC) had recognized the increased harm related to extended1 Defendant Honeywell International, Inc. is the corporate successor to Bendix and now responsible for all asbestos liabilities attributed to Bendix. Ante at ___ (slip op. at 14- 15).2 As of 2007, approximately $504,000,000 had been paid out on over 28,000 claims related to those products. Over 80 percent of the total settlement dollars were for mesothelioma cases. Mesothelioma is a rare cancer that may not manifest until thirty to forty years after exposure. See Centers for Disease Control and Prevention, Health Effects of Asbestos, https://www.atsdr. cdc.gov/asbestos/health_effects_asbestos.html (last updated Nov. 3, 2016). 12 exposure to asbestos. See, e.g., Centers for Disease Controland Prevention, NIOSH: Health Hazard Evaluation Report 5 (June1985), https://www.cdc.gov/niosh/hhe/reports/pdfs/83-44-1596.pdf(describing asbestosis as “form of pulmonary fibrosis secondaryto the accumulation of airborne asbestos in the lungs”). Notonly is duration of exposure a risk factor in whetherindividuals eventually manifest an asbestos-related injury, itis also correlated with the severity of the injury. Ibid.(noting that severity of disease is correlated with type andduration of exposure to asbestos). Given the apparent health hazards and number of pending andexpected personal-injury lawsuits relating to Bendix’s brake andclutch pads, the primary insurance carriers in 1986 and then theexcess insurers in 1987 declined to underwrite coverage forthose products. Despite the known medical dangers of asbestos,more than a decade of lawsuits, and an insurance marketplacethat refused to provide coverage for its asbestos products,Bendix opted to continue to manufacture its asbestos-containingbrake and clutch pads for fourteen more years without liabilitycoverage. Bendix’s decision put at risk the health and safetyof countless workers exposed to the dangerous asbestos fibers inits products over those fourteen years. Now, a majority of the Court holds that Bendix, though itpaid no premiums for coverage, is insured for the injuries 13 caused to mechanics and others who worked with the products itcontinued to manufacture -- so long as the first asbestosexposure predated the period when the company went bare ofinsurance. According to the majority, the insurance carriersthat previously issued liability policies to Bendix must pick upthis grisly tab. Of course, in the future, companies similarlysituated to Bendix will have less incentive to stop producingdangerous products under such a scheme. In my view, we have reached this point so in conflict withgood public policy by not giving a common-sense reading toOwens-Illinois, a landmark case intended to further the publicwelfare. Owens-Illinois constructed a methodology to allocateinsurance coverage among multiple policies in cases ofprogressive toxic diseases that run a course of years from thefirst exposure to the manifestation of the disease. 138 N.J. at 478-79. Implicit in the discussion on allocation methodology isthe understanding that duration of asbestos exposure is linkedto disease. Id. at 474-75. Because of the impossibility ofquantifying the extent of harm caused to an individual in anyparticular year, the Court, as a matter of public policy,decided to “treat the progressive injury or damage as anoccurrence within each of the years [of a comprehensive generalliability] policy.” Id. at 468, 478 (emphasis added). Theallocation scheme spread the costs of indemnification coverage 14 among the triggered policies from the time of exposure tomanifestation of the disease based on the risk assumed by thecarrier and its years on the risk. Id. at 475. The Courtadopted that paradigm because equity and notions of simplejustice demanded that it do so. Id. at 472-73. The Court also recognized that a company might determine togo without insurance for a period of years and, under thosecircumstances, the allocation scheme includes the company’s prorata contribution, depending on its time on the risk and thedegree of the risk it assumed. Id. at 479. The language inOwens-Illinois that is at the core of the controversy arisesfrom one seemingly obscure phrase. The Court stated, “[w]henperiods of no insurance reflect a decision by an actor to assumeor retain a risk, as opposed to periods when coverage for a riskis not available, to expect the risk-bearer to share in theallocation is reasonable.” Ibid. (emphasis added). The quotedclause is known as the unavailability exception. Owens-Illinoismentions the “unavailability” of insurance in passing. There isno further explanation or support given for the clause. One logical interpretation of that clause accords with thenotions of fairness and simple justice advanced in Owens-Illinois. If insurance is unavailable to a company for aproduct that it has stopped manufacturing, the insurancecarriers that issued occurrence policies in prior years remain 15 on the risk through the time until the disease manifests. Noone would dispute the application of the allocation scheme inthat manner. It is another thing, however, to say that a company, suchas Bendix, that continues to manufacture an inherently dangerousproduct for which no insurance carrier will provide liabilitycoverage can avoid full financial accountability and transferthe risk to prior insurers. Such a system runs counter to theprinciples of fairness and justice enunciated in Owens-Illinoisand those underlying our tort law. Other courts have alsoacknowledged the absurdity of applying the unavailabilityexception to actors like Bendix. See, e.g., R.T. Vanderbilt Co.v. Hartford Accident & Indem. Co., 156 A.3d 539, 585-88 (Conn.App. Ct. 2017) (recognizing that application of unavailabilityexception might provide corporate actor “a windfall at itsinsurers’ expense” because “insurers might have to defend andindemnify claims for injuries that would not have occurred, orthat would have been less severe, but for [the actor]’s decisionto continue to sell [an asbestos-containing product]”). Equity demands that a corporation that continues tomanufacture a dangerous product without insurance become theultimate insurer for its actions. Justice O’Hern -- the authorof Owens-Illinois -- reminds us that corporate actors should“know that if they do not transfer to insurance companies the 16 risk of their activities that cause continuous and progressiveinjury, they may bear that untransferred risk.” See 138 N.J. at 473. The unavailability exception, as applied by the majority,removes Bendix’s corporate accountability as a self-insurer forthose workers first exposed to Bendix asbestos products before1987 and in the fourteen years that it continued to manufactureits dangerous products. By diluting Bendix’s responsibility asa self-insurer, the majority’s decision fails not only to detercorporate risk-taking at the expense of public health, butrather gives an incentive to such risk-taking because there isno full financial reckoning for continued bad behavior. Byholding companies accountable for their irresponsible conduct,tort law has a salutary deterrent effect. Although the dominantforce motivating most companies is to increase profits, one ofthe major purposes of the common law is to promote the publichealth and welfare of our citizens. The majority’s decision also interferes with the naturalflow of market forces, which, if left untouched, would advantagethe public. When insurance carriers no longer provide coveragefor the continued manufacture of a product endangering thepublic health because of the prospect of financially ruinouslawsuits, the marketplace is making a definitive statement thatwhatever good the product offers is outweighed by the risk. 17 Under such circumstances, the natural course of events mightlead the company to abandon the manufacture of the dangerousproduct. But, if insurance carriers that previously providedcoverage for the product must -- by the fiat of the Court --insure the risk against their will, then corporations can sendtheir potentially deadly wares into the stream of commerceknowing that they will not bear the full risk in doing so. Theperverse logic of this scheme is evident here. Bendix continued to manufacture asbestos-containing brakeand clutch pads for fourteen years after insurance was no longeravailable. For fourteen years, workers exposed to asbestosfibers before 1987 remained exposed to the potentially deadlytoxin, increasing their risk of contracting various serious andlethal diseases. Yet, Bendix now gets -- and future similarlysituated companies will get -- a windfall bailout because thisCourt has conscripted insurance carriers into paying the bill. The Owens-Illinois Court had in mind an equitableallocation formula -- not the twisted one that has taken rootfrom a single difficult-to-decipher clause in an opinionintended to promote the public welfare. Nor did the Courtexpect that its opinion would be “the 'last word’ in this area.”Owens-Illinois, 138 N.J. at 478 (quoting N. States Power Co. v.Fid. & Cas. Co., 523 N.W.2d 567, 665 (Minn. 1994)). Indeed, it 18 instructed a future Court to “revisit the issue [of coverage forlong-term exposure injury]” if the solution provided is“inefficient or unrealistic.” Ibid. I expect that insurance carriers will adjust to this newmethodology. Knowing that they will be compelled to providecoverage, whether they wish to or not, carriers may decide tooffer coverage at much higher premiums -- thus renderinginsurance available for products that would have beenuninsurable. I do not believe that the path that the majority is takingcan be justified by Owens-Illinois or sound public policy. Ibelieve that the majority is making a critical error in allowingthe unavailability exception to extend to claims of workerswhose first asbestos exposure occurred before 1987 but whosediseases progressed during the fourteen years that Bendixcontinued to expose them to the potentially lethal fibers --despite the absence of insurance coverage. “[T]o send thecorrect signals to the economic system, a judge must appreciatethe consequences of legal decisions on future behavior.” Id. at473 (alteration in original) (citation omitted). This case is not just about Bendix or asbestos products,but about the signal this Court gives to corporate actors whomust assess costs and risks -- and profits -- when decidingwhether to unloose their uninsured dangerous products on the 19 public or their uninsured dangerous substances into theenvironment. I therefore respectfully dissent from the part of themajority opinion addressing the unavailability exception. Iconcur in the Court’s conflict-of-law analysis and resolution. 20