The 7th U.S. Circuit Court of Appeals ruled Tuesday that Axis Insurance Co. can seek coverage from another insurer for a settlement it reached to resolve an injury lawsuit filed by former NFL kicker Lawrence Tynes.
The three-judge panel in Axis Insurance Co. v. American Specialty Insurance & Risk Services overturned a ruling by a federal judge in Fort Wayne, Indiana, that said Axis could not obtain coverage from American because it did obtain the insurer’s consent before settling Mr. Tynes’ lawsuit against the Tampa Bay Buccaneers.
Axis and American had entered into a contract in which American could accept proposals for insurance as well as negotiate, underwrite and accept coverage on Axis’ behalf. The contract said if American acted negligently, it would indemnify Axis for any resulting losses.
In May 2013, a representative for the Buccaneers contacted American about obtaining an insurance policy that included employers liability coverage. American obtained a policy for the NFL team that it thought included the requested coverage, court records show.
The absence of the coverage became evident after Mr. Tynes sued the team in April 2015 after suffering a career-ending injury from contracting a Methicillin-resistant staphylococcus aureus infection following a medical procedure.
Axis denied coverage for the claim, saying the policy did not have coverage for employers liability. American acknowledged there was a mistake when generating the policy and urged Axis to reform it to include employers liability coverage.
Mr. Tynes’ suit eventually settled for $4 million in February 2017.
Axis sued American in federal court in Indianapolis seeking coverage for the settlement. American moved for summary judgment, and the trial judge ruled in its favor.
Representatives for the parties did not respond to requests for comment.
