Hunton Insurance Recovery Blog

In a recent client alert, Hunton insurance attorneys Geoffrey B. Fehling and Alundai J. Benjamin discuss the Fourth Circuit’s broad interpretation of a “related claims” provision in a healthcare liability policy. The dispute arose from two lawsuits against a laboratory testing company alleging systemic deficiencies in testing practices that produced false positives, where the later-filed lawsuit repeated and expanded on allegations from an earlier suit. Interpreting policy language and Fourth Circuit law requiring only a logical or causal connection based on “any common fact,” the appellate court overturned the district court opinion and held that the lawsuits were related and deemed a single claim first made during the earlier policy period.

The decision reinforces the importance of carefully evaluating related claims provisions in claims-made liability policies, particularly when claims span multiple policy periods or insurers. Broadly worded related claim provisions can consolidate separate actions into a single claim, shift coverage obligations between insurers, and materially affect the availability of limits, creating unexpected risks for policyholders if policies are not aligned across years.