Opinion ID: 3057456
Heading Depth: 2
Heading Rank: 2

Heading: Satisfaction of the SIR

Text: Alternatively, State National argues that the SIR can be satisfied only by 10 Case: 11-15905 Date Filed: 07/12/2012 Page: 11 of 13 defense costs and damages for covered claims. The SIR endorsement provides that Hillsborough County retains, as a selfinsured retention, $350,000 per occurrence “as respects combined insured damages and insured allocated costs and expenses of investigation, defense, negotiation and settlement applicable to such damages.”4 Further, State National agreed to pay if “any combined insured damages and insured allocated costs and expenses exceed, per occurrence” the $350,000 retention. The SIR endorsement does not define the phrases “combined insured damages” and “insured allocated costs and expenses.” State National contends that “insured” in these two phrases should be read to mean covered under the POELI endorsement, such that only damages for covered claims and costs and expenses related to those damages can satisfy the SIR amount. This is one possible interpretation of the SIR endorsement.5 4 State National does not challenge the district court’s determination that, because the SIR endorsement required Hillsborough County, as named insured, to retain $350,000 per occurrence and not per insured, if the SIR amount was satisfied as to Hillsborough County, it was also satisfied as to White. 5 The district court pointed out that State National’s interpretation may be unreasonable for two reasons. First, it is inconsistent with the district court’s earlier ruling that, under Florida law, an insurer’s duty to reimburse under a SIR endorsement, like an insurer’s duty to defend under a liability policy, is triggered if any alleged claim is covered. See, e.g., Baron Oil Co. v. Nationwide Mut. Fire Ins. Co., 470 So.2d 810, 815 (Fla. 1st DCA 1985) (explaining that an insurer has a duty to defend the entire action if some alleged claims are covered and some are not, at least until the covered claims are eliminated from the suit). Second, it may not be possible or appropriate to apportion defense fees and costs between covered and non-covered claims 11 Case: 11-15905 Date Filed: 07/12/2012 Page: 12 of 13 However, the district court noted another reasonable interpretation, that is, that the phrase “insured damages” means damages incurred by the named insured (or perhaps any insured), as opposed to those incurred by the insurer or a third party. The district court noted that this interpretation “is more consistent with the general purpose of the SIR Endorsement and the Policies as a whole,” to limit the exposure of Hillsborough County and its employees to $350,000 per occurrence. See U.S. Fire Ins. Co. v. J.S.U.B., Inc., 979 So.2d 871, 883 (Fla. 2007) (explaining that an insurance policy must be read “as a whole, endeavoring to give every provision its full meaning and operative effect”). Under this interpretation, the SIR endorsement could be satisfied by defense costs and expenses for both covered and non-covered claims incurred by Hillsborough County. Accordingly, we agree with the district court that the SIR endorsement is ambiguous as to which damages and costs count toward the SIR. See Travelers Indem. Co. v. PCR Inc., 889 So.2d 779, 785 (Fla. 2004) (explaining that language in an insurance policy is ambiguous if it “is susceptible to more than one given that Ogden’s § 1983 and FCRA claims were governed by the same standards of liability applicable in employment discrimination cases. See Rice-Lamar v. City of Ft. Lauderdale, 232 F.3d 836, 843 n.11 (11th Cir. 2000) (noting that § 1983 gender discrimination claim involves the same analysis as a Title VII disparate treatment claim); Harper v. Blockbuster Entm’t Corp., 139 F.3d 1385, 1387 (11th Cir. 1998) (noting same for FCRA gender discrimination claims). We need not address this question, however, because even assuming State National’s interpretation is reasonable, it is not the only reasonable interpretation and, thus, the SIR endorsement is ambiguous and must be construed in favor of the insured. 12 Case: 11-15905 Date Filed: 07/12/2012 Page: 13 of 13 reasonable interpretation, one providing coverage and the other limiting coverage.” (internal quotation marks omitted)). And, given that the SIR endorsement is ambiguous, the district court properly construed it in favor of coverage. See Auto-Owners, 756 So.2d at 34 (“[A]mbiguous insurance policy exclusions are construed against the drafter and in favor of the insured.”). Therefore, the district court did not err in concluding that Hillsborough County’s $490,989.18 in costs and expenses incurred in the Ogden litigation, whether or not directly attributable to covered claims, satisfied the SIR amount and that State National was required under the SIR endorsement to reimburse White for his own defense costs and expenses. AFFIRMED. 13