The Mississippi Top court overturned a lesser court ruling Thursday and ruled that a Markel Corp. unit must provide coverage under its excess insurance policy for a 2022 plant explosion.
On July 28, 2022, an explosion at Omega Protein Inc.'s facility in Moss Point, Mississippi, killed one man and damaged several others, according to Thursday's ruling by the state's high court in Omega Protein Inc. v. Evanston Insurance Co.
Omega Protein Inc. had applied for a master service contract with Moss Point-based Accu-fab & Construction Inc. to perform welding and other facilitation work at the facility, under which it was required to provide commercial liability insurance that named Omega being an additional insured, the ruling said.
Accu-fab obtained a $1 million primary policy issued by Argo Group International Holdings Ltd. unit Colony Insurance Co. along with a $5 million excess policy from Markel unit Evanston Insurance.
Litigation ensued, and Omega and also the deceased worker's estate settled, with Colony contributing $1 million, an amount comparable to the applicable policy limits.
Evanston filed a motion for summary judgment, arguing Omega wasn't an additional insured under the Colony policy and for that reason not an additional insured under the excess policy, which a pollution exclusion in the policy applied. The low court granted the motion and Omega appealed.
In its unanimous opinion reversing the low court, the Mississippi Supreme Court said, “Because the pollution exclusion in the (Evanston) insurance contract was ambiguous, it should be construed from the insurer as well as in favor of the insured, allowing coverage.
“Further, we discover the question whether coverage was triggered is controlled by the word what from the contract which Evanston did not prove there might be no coverage underneath the excess liability policy,” a legal court said, in reversing the trial court's grant of summary judgment and remanding the situation for further proceedings.
Attorneys in the case did not react to requests for comment.
In an instance related to Omega's coverage in the explosion, in 2022 a federal appeals court cited advice supplied by the Mississippi Supreme Court and affirmed a lesser court ruling in support of a Swiss Re Ltd. unit in a dispute with Colony.
