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ARTICLE · 17 OCTOBER 2024

No Prejudice Required For Late Notice Under Claims-Made E&O Policy

The United States District Court for the Southern District of New York, applying Michigan law, has held that a claims-made E&O policy does not afford coverage where the insured failed to comply with a condition precedent to coverage requiring it to provide notice of a claim within 90 days of the policy's expiration.

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The United States District Court for the Southern District of New York, applying Michigan law, has held that a claims-made E&O policy does not afford coverage where the insured failed to comply with a condition precedent to coverage requiring it to provide notice of a claim within 90 days of the policy's expiration, irrespective of whether the insurer can demonstrate prejudice. Atos Syntel Inc. v. Ironshore Indem. Inc., 2024 WL 4227709 (S.D.N.Y. Sept. 17, 2024).

The policyholder was a technology and professional services provider that purchased an E&O insurance tower for the policy period of October 8, 2014 to October 8, 2015 (the "14-15 Tower"). The first excess insurer in the 14-15 Tower did not renew its policy for the 2015-2016 policy period (the "15-16 Tower") and accordingly only participated in the 14-15 Tower.

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