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Washington decision highlights case law’s relevance to insurers

By Mitch Tarter  |  August 13, 2019

In Xia vs. ProBuilders Spec. Ins. Co. (189 Wash. App. 1041 [2017]), the insurer argued that the non-ISO pollution exclusion in its commercial general liability (GL) policy protected it from the insured’s bodily injury claim related to carbon monoxide poisoning from a negligently installed water heater. The court rejected that argument, finding in favor of the insured in what one legal observer called an “extraordinary ruling.”

The decision may have implications for insurers currently writing or considering entering the GL market in Washington. Insurers may decide to evaluate whether exclusions they have in place still apply to certain claims and might consider if they need to rewrite or develop policy language to address the ruling’s impact.

They may also find themselves having to defend against or settle claims they could not have anticipated before the ruling.

The decision may have longer-term implications as insurers’ in-house counsel may wish to contemplate new legal strategies in light of the decision.

1,000+ decisions a year

The questions—and potential associated costs—arising from this one case underscore the need for insurers to keep track of relevant case law developments for every jurisdiction. More than 1,000 new decisions relevant to the GL line of business alone are released annually, with more than 200 federal and state courts handing down new decisions daily.

ISO generally monitors select legal decisions for the GL line of business as part of its core services. In fact, in July 2018, ISO filed new commercial lines forms in response to the Xia decision.

Additionally, ISO soon will be launching ISO CourtSide, a case law analytics dashboard that will track legal decisions and provide jurisdiction-by-jurisdiction analytics and scoring for decisions related to a multitude of highly relevant topics.

The initial focus of ISO CourtSide will be on cases likely to involve GL policies and claims.

Insurance Services Office, Inc. (ISO) makes available advisory services to property/casualty insurers. ISO has no adherence requirements. The preceding summary may include opinions from ISO staff. These opinions expressed by ISO staff do not necessarily reflect every insurer’s view or control any insurer’s determination of coverage. ISO does not interpret insurance policies or intercede in coverage disputes arising from insurance policies. You should conduct your own review of the related case, consult with your legal counsel, and determine its effect, if any, on your company’s operations. We urge that you be guided by the advice of your attorneys on all legal requirements.


Mitch Tarter is an InsurTech product manager for ISO, focusing on legal data and analytics. Mitch manages ISO CourtSide, and can be reached at Mitchel.Tarter@verisk.com.

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