The Increasing Role of Indemnity Agreements in Allocating Insurance Proceeds and its Effect on the Transportation Industry


Determining the number of carriers that may owe coverage for an accident, and how that coverage is to be allocated amongst those carriers, can often be a difficult and complicated task. This is because there may be truckers or other business auto policies issued to the hauler, and there may also be policies in place that have been purchased by the driver and the agent under whose authority the hauler is operating. While determining how to allocate insurance proceeds amongst concurrent insurers is generally determined by comparing the applicable policies’ “other insurance” clauses, there is an increasing trend, both in Missouri and around the country, towards an allocation scheme that gives effect to indemnity provisions in contracts between the insureds, even where to do so would contradict the provisions of the applicable “other insurance” clauses.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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