Opinion ID: 774243
Heading Depth: 3
Heading Rank: 2

Heading: Competing Policies

Text: 11 The Samaritan Policy provided primary insurance to Dr. Romberger. The relevant portion of the Samaritan Policy reads: 12 (7) Other Insurance: The insurance afforded by this policy is primary insurance, except when stated to apply in excess of or contingent upon the absence of other insurance 13 b. With regard to physician Insureds, the insurance provided by this policy shall be primary, and it shall not be reduced by the amount of any other insurance the physician Insured may have. 14 The Samaritan Policy's coverage of Dr. Romberger commenced October 1, 1986. It contained a policy limit of $1 million per occurrence, $12 million in the aggregate. It is undisputed that the Samaritan Policy provided the first layer of coverage applicable to the Beery judgment. It is also undisputed that Samaritan's total liability with regard to the Beery judgment is $1 million (including costs of litigation) and that Samaritan has contributed its policy limit.
15 The MICA Policy is entitled a Modified Claims Made Insurance Policy. It provided coverage to Dr. Romberger from September 1, 1983 through October 25, 1986. The limits of MICA's policy are $1 million for each occurrence and $1 million in the aggregate. 16 The MICA policy also provided primary coverage to Dr. Romberger. It covered accident[s], act[s] or omission[s] which might give rise to a suit within the policy period. Claims and actions resulting from any act covered by the policy were also covered. Dr. Romberger paid a total of $90,362 in premiums for this coverage. 17 The MICA policy, however, also contains an other insurance clause, which reads: 18 This insurance shall not apply unless and until the limits of all other sources of funds have been exhausted. Such sources shall include: 19
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22 The RRG Policy differs from both the Samaritan and MICA policies in that Dr. Romberger was not its purchaser. Samaritan Health Systems, his insurer, purchased it as umbrella coverage for multiple healthcare institutions and contract physicians (such as Dr. Romberger) that are insured, in the first instance, by Samaritan. The RRG policy offered four layers of coverage with a total policy limit of $24 million. Samaritan paid premiums to RRG totaling $7,534,977. 23 The first layer of RRG coverage was entitled excess insurance and provided a policy limit of $1 million for each occurrence, but with no aggregate limit. It became effective October 1, 1986, and was written specifically as excess of the underlying Samaritan Policy. While this layer of coverage did not include a designated, separate other insurance clause, it did define loss so as to provide that the insurer had no liability until deductions for all other recoveries, salvages, or other insurance were made. 24 The second layer of RRG coverage, also effective October 1, 1986, was entitled Hospital Umbrella Liability Policy. It provided $10 million in insurance excess of Underlying. Among the Underlying was the Samaritan Policy, the first layer of RRG's coverage, and several other insurance policies listed in the schedule of underlying coverage. The MICA policy, which Dr. Romberger purchased, was not listed. 25 Although this second layer of coverage stated that it was excess of the listed underlying policies, it more narrowly defined its coverage. Specifically, this layer of RRG coverage purported to apply only to the ultimate net loss in excess of the applicable underlying limit. Applicable underlying limit was, in turn, defined as the total of the limits of the underlying insurance . . . and the limits of any other valid and collectible insurance . . . . 26 In addition, this second layer of coverage included an other insurance clause, which reads: 8. OTHER INSURANCE 27 a. The insurance afforded by this policy shall be excess insurance over any other valid and collectible insurance available to the insured, whether or not described in the Schedule of Underlying Insurance . . . and applicable to any part of ultimate net loss, whether such other insurance is stated to be primary, contributing, excess or contingent. 28 The third layer of RRG coverage became effective October 1, 1987. It provided $5 million in coverage for losses in excess of $10 million. This policy is entitled Excess Umbrella Liability. By its express terms, this insurance did not provide coverage until $10 million in underlying insurance had been exhausted. 29 The fourth and final layer of RRG coverage became effective October 1, 1988. It provided $8 million in coverage for losses in excess of $15 million. However, this final layer of RRG coverage did not become effective until after Dr. Romberger's care of Christina Beery ended. The district court held that this layer of coverage was not applicable to the Beery judgment. MICA did not appeal this ruling.