To the extent that a buyer may be acquiring liabilities, it may want to determine whether the seller’s insurance for such liabilities will also transfer. Similarly, sellers may want to assess the potential impact of transferring policies that may be applicable to liabilities that they retain. Based on the circumstances of a deal, such assessments may be complicated because legal issues regarding transfers of assets and liabilities, as well as the validity of any so-called “anti-assignment” provisions, are complex and vary from state to state depending on the nature of the transaction and the nature of the liability.
For instance, some courts have held that the right to recover under an insurance policy follows the liability for which the coverage is sought. Other courts have held to the contrary on the theory that “[t]he law can impose tort liability on a successor corporate entity; it cannot impose a contractual insurance relationship between an insurer and a stranger to the insurance contract.” Because of the potential importance of insurance for assumed or retained liabilities, whether insurance policies will transfer to the successor could be a significant issue for a party to take into consideration.
As a general matter, deal negotiators should not assume that policies will automatically transfer in conjunction with a corporate transaction absent specific, proactive steps. In particular, many insurance policies contain express so-called “anti-assignment” provisions or are excess policies, which are arguably subject to the terms and conditions of the underlying policies, including “anti-assignment” provisions. These provisions purport to prohibit assignment of the policy without the insurer’s consent (e.g., “Your rights and duties under this policy may not be transferred without [insurer’s] written consent except in the case of the death of an individual named insured.”). Similarly, policies may contain “change of control” provisions that seek to limit or terminate coverage where the insured consolidates with, merges into, or sells all or substantially all of its assets to another entity. The purpose of such provisions is to “prevent an increase of risk and hazard of loss by a change of ownership without the knowledge of the insurer.”
Courts have typically recognized the validity of contractual provisions against assignment of contracts, including insurance policies. Thus, courts frequently uphold “anti-assignment” provisions so that an insurer is not liable to indemnify or defend claims against an assignee of the policy as to whom it has not consented. It is a matter of dispute whether such provisions apply to both attempted assignments of the policy by sale as part of the insured’s business and to assignments by operation of law through corporate mergers or successor liability. Some entities have faced difficult battles with insurers over these anti-assignment issues when they did not obtain consent.
Generally, in corporate mergers, the predecessor’s assets (including its insurance coverage) and liabilities are transferred to the successor as a matter of law. Numerous courts have held that the surviving corporation of a merger is entitled to insurance coverage under policies issued to the predecessor corporation for claims arising out of the pre-acquisition activities of the merged corporation, even where an anti-assignment provision was purportedly violated. Arguably, the risk contemplated by the insurers is not substantially altered by requiring them to provide coverage for the pre-acquisition activities of the merged corporation.
However, in other transactions, such as asset purchase agreements, the purchaser is not generally liable for debts or obligations of its predecessor, and a court may be more likely to enforce an anti-assignment provision. For example, in instances where the successor entity is not a “mere continuation” of the predecessor entity, where recourse to the predecessor is available, or where the two entities (successor and predecessor) have separate identities, courts may uphold the validity of anti-assignment provisions. Accordingly, companies involved in these types of transactions may encounter resistance from insurers if the application of an anti-assignment clause becomes an issue.
Under certain circumstances, courts will decline to enforce anti-assignment provisions. For example, an insurer may waive the consent requirement or be estopped from denying a valid assignment. Further, anti-assignment language may not be enforced where, at the time of assignment, the insurance benefit had been reduced to a claim for money due or to become due. Similarly, insurer consent may not be required where the assignment concerns the right to policy proceeds. In addition, in many jurisdictions, the law does not prevent assignment—in spite of anti-assignment policy language—where the assignment takes place after the loss for which coverage is being sought. Indeed, the majority rule distinguishes between pre-loss and post-loss assignments.
In differentiating between pre-loss and post-loss assignments, some courts have reasoned that allowing an insured to assign the right to coverage before a loss would force the insurer to protect an insured with whom it had not contracted —an insured who might present a greater level of risk than the policyholder. However, allowing an insured to assign its right to the proceeds of an insurance policy after a loss has occurred does not modify the insurer’s risk. The insurer’s obligations are fixed at the time the loss occurs, and the insurer is obligated to cover the loss agreed to under the terms of the policy. This obligation is not altered when the insured is not the party who was originally insured. After the loss, the anti-assignment clause serves only to limit the free assignability of claims, which is not favored by the law, and such restrictions on an insured’s right to assign its proceeds are generally rendered void.
However, it should be noted some courts have held that parties may contract to prohibit post-loss assignments provided the contract language clearly and unambiguously expresses that the non-assignment clause applies to post-loss assignments. Further, a minority of courts have enforced anti-assignment clauses post-loss and without requiring the insurer to show prejudice. For example, “Texas courts uphold anti-assignment provisions so long as they do not interfere with the operation of a statute.” Because of the wide-ranging legal opinions and the potential impact of the issue of insurance, analyzing these issues during the course of the deal may help a company avoid substantial uninsured losses post-closing.
Analyzing Existing and Potential Liabilities as Part of Due Diligence
To protect both the buyer and seller in transactions, it may be prudent for companies in the deal cycle to consider insurance coverage issues as part of their due diligence review. Adequately assessing risk to be acquired is fundamental to identifying any deal-breaking exposures to financial loss. Understanding potential new liabilities may require the parties to a transaction to know which risks are insured and which risks are uninsured. Buyers may find it helpful to identify and quantify existing and potential liabilities as well as to have a clear understanding of whether they can and will be acquiring any insurance coverage for such liabilities from the seller.
Some areas to consider examining before closing a deal are pending or threatened litigation, legal compliance issues, environmental contingencies, current and historical operations, indemnity obligations, tax liabilities, and whether there are any unusual or hazardous or uninsurable operations, products, physical assets, or geographic locations. Buyers should also consider calculating the potential liabilities arising out of the recall of products of a subsidiary of the seller. Other specific areas to consider addressing include whether there are any long-tail product claims, requisite disclosures in regard to environmental remediation, violations of the Occupational Safety and Health Act or equal employment opportunity laws, or product, directors and officers, or employment practices suits.
Buyers addressing insurance issues should consider compiling and analyzing historical loss data and exposure data. In general, the primary sources of information about the seller’s risks and financial obligations are loss statistics or copies of actual loss runs. In addition, buyers should consider obtaining and analyzing loss-trending data (such as data establishing the length of time that it takes for workers’ compensation and liability claims to develop to their final, ultimate value), as well as the amount reserved on the general ledger.
On the other hand, sellers evaluating insurance issues should consider assessing the potential impact of transferring insurance policies that may be applicable to liabilities that remain with the seller prior to determining whether such assets should be part of the deal. Knowing which risks are insured which risks are uninsured may be helpful in identifying any deal-breaking exposures to financial loss on both sides of the deal. Furthermore, the terms of the deal itself, such as whether there are indemnification provisions pertaining to self-insured or uninsured liabilities, may provide valuable insight as to the potential and ultimate financial value of a deal.
Analyzing Coverage Programs During Due Diligence
To determine the existence, applicability, and scope of potential coverage, the parties to a transaction should consider reviewing and analyzing the insurance programs of both sides of the deal. By way of example, a question that may warrant consideration at the outset of the deal is whether the company being acquired will be absorbed into the insurance program of the buyer or whether it will have to operate on a stand-alone basis. The answer to this question may require consideration of numerous other insurance issues.
As an initial matter, a party may want to gather as much insurance-related information as possible during the due diligence process, including the following: complete copies of all policies (including endorsements, amendments, and schedules); secondary evidence of lost or missing policies; applications for insurance; correspondence with insurers (both claims and underwriting); evidence of payment of premiums; any notices of cancellation of policies; a loss history (typically for at least 10 years); and audits or other calculations pertaining to retrospective premium programs. The period of time for which insurance-related information is sought will vary depending on the nature of the transaction. However, as a practical matter, the acquiring company should try to obtain as much of this information as possible when the interest in the deal is high because once a deal has been finalized, it may be difficult to motivate a seller to undertake a policy search or records may be destroyed subsequent to a transaction closing.
The due diligence team may then want to take the next step of analyzing the policies and information that they have obtained. Reconstructing the selling company’s historical insurance coverage programs can provide insight into whether coverage may exist for claims made against it for injury or damage caused by, or attributable to, past operations. Identifying companies (including those possibly now spun off) that still can make claims under the seller’s historical insurance program can be a valuable consideration. Further, the existence of unique exposures that may require special types of insurance for which there may only be limited availability at high premiums may also be an important issue. It may be prudent for both sides to a transaction to understand the nature and extent of coverage for purposes of valuation.
Generally, historical comprehensive general liability (CGL) policies are often considered to be valuable for long-term exposures or risks because they typically have fewer exclusions and no aggregate limits of liability for certain categories of risk. Obviously, there are many things to look for in order to assess the ultimate value of the policies, but, as an initial matter, they should be reviewed to determine whether they are occurrence-based, claims-made, or claims-made and reported policies.
From about 1966 to 1986, almost all CGL policies were written on an “occurrence” basis. Since 1986, CGL policies generally come in two versions: “occurrence based” and “claims made.” The main difference between these two types of policies is the event that triggers coverage. Occurrence-based policies provide coverage for bodily injury or property damage that takes place within the policy period, regardless of when a claim is asserted against the insured for liability. Thus, under an occurrence policy, an insurer may be liable for bodily injury or property damage where the actual injury or damage may not be apparent for years or decades after the policy period has expired but which nevertheless occurred during the policy period. In contrast, claims-made policies are triggered when a claim is first asserted against the insured during the policy period. Thus, there may be no coverage once their periods have expired, and they may not have the continuing responsibility that is characteristic of occurrence policies. Accordingly, it is important to know whether policies are claims-made policies that have already expired or will expire before closing.
The policies should also be reviewed to determine the adequacy of coverage limits, including whether they have aggregate limits or no limits applicable to various types of claims. An aggregate limit is the most the insurer will pay for losses under a particular policy. Often, older CGL forms do not contain aggregate limits for premises and operations losses, and many umbrella policies that were issued before 1986 only have aggregate limits for product liability and occupational disease claims. However, some historical policies have related-corporation combined limits, so attention should be paid to the limits of liability and any provision affecting those limits.
Part of knowing what is covered is being aware of what is potentially excluded from coverage. Although most insurance policies are written on standard forms, customized or “manuscript” policies may contain unique terms or conditions, and even standard form policies may be altered by endorsements limiting coverage or excluding certain types of risk. Reviewing policies to determine what exclusions are contained in them and whether there are any unique exclusions—such as exclusions for specific products—may help with respect to determining the scope of coverage and can also lead to discovery of undisclosed liabilities.
In addition to the obvious exclusions, policies should be reviewed for hidden limiting clauses such as “deemer,” non-cumulation of liability, or “telescoping” clauses. Insurers routinely argue that these types of provisions should be applied to limit a policyholder’s recovery to the indemnity limits of one policy even though several policies may potentially be triggered. Further, policies may contain provisions that arguably convert occurrence-based policies into claims-made policies. Thus, policies must be carefully reviewed to appreciate the full extent of any such limitations.
It may also be important to look for and understand the scope of certain types of insurance designed to respond to claims against companies and their management arising from their day-to-day business decisions such as directors’ and officers’ (D&O), fiduciary liability, employment practices liability, or other management liability policies. Frequently, these types of coverage are overlooked or intentionally omitted by companies in order to cut costs and could cause gaps in coverage programs. Moreover, it should be noted that even when companies have management liability coverage in place, there are so many variations in the marketplace, and the needs of policyholders vary so widely, that coverage gaps are not uncommon.
The solvency status of the insurers, both present and historical, is also an important consideration. Obviously, if an insurer that has issued a policy becomes insolvent or otherwise defaults on its obligations, the policyholder could be adversely affected. Thus, it may be prudent to discuss the ratings of insurance companies that have sold policies to a company. Further, because of the numerous insurer insolvencies in the wake of long-term asbestos and environmental claims, the solvency of historical insurers should be examined before assessing the value of historical coverage.
Once the general parameters of the policies and their limitations have been determined, the next step is to assess how the coverage program has been affected. Foremost, has there been any exhaustion or erosion of policy limits? For instance, have there been any large claims that could have substantially, if not completely, eroded coverage such as toxic tort, asbestos, product liability, or environmental claims? Even if these claims have not completely eroded coverage, settlements may have affected the available coverage. Accordingly, another consideration is whether there have been any settlements (including policy buybacks, site releases, or claim releases) or whether any of the policies have been commuted resulting in gaps in coverage.
Another area that may be considered is premiums or deductibles. Some coverage programs provide for high deductibles or self-insured retentions to lower the cost of premiums. Other programs use retrospective premium plans (where the final premium is based on the insured’s actual loss experience during the policy term rather than a premium at the outset of the policy). Under retrospective premium plans, a current year’s premium may be based partially on that year’s losses, although the final premium calculations may take months or years beyond the current year’s expiration date. An acquiring company could end up being responsible for significant amounts in retrospective premiums, which should be considered in pricing the deal.
Allocation of premiums is usually a straightforward analysis if an entire company is being bought or sold, but it becomes more complicated if a single business unit is being purchased or spun off. If a company is selling off a subsidiary, the due diligence team may consider assessing whether the business unit has its own stand-alone policies. If not, the loss history of that business unit needs to be reviewed in order to come up with a proper allocation with respect to the remaining premium to be paid. Similarly, if there are different business units within a company that is being purchased, their loss experience may be different; thus, allocation of premiums among the various risks may be necessary to fully understand their effect on the bottom line. For numerous reasons, premiums can affect a company’s business plan, and it can be helpful to consider premiums in determining how acquiring or selling a unit is going to affect the current plan.
Identifying Indemnity Issues That May Affect Insurance
Another area that may warrant consideration during due diligence is the impact that contract indemnification language in the deal agreements or in contracts to be acquired may have on insurance coverage. Many states have different rules regarding indemnity agreements and their enforceability. The extent to which an indemnity agreement is enforceable may affect whether the indemnitor has insurance available to respond to those indemnity obligations.
In addition, where a business is being acquired, the team should consider reviewing the indemnity provisions in the target’s contracts (e.g., supplier and vendor contracts) to determine whether they are enforceable, especially where a transaction results in operations in different states. As a separate matter, steps should be taken to ensure that insurance coverage is obtained to comply with contractual obligations, such as obligations to name others as additional insureds on policies.
Documenting the Insurance Aspects of a Deal
The terms of the deal itself should be clear about whether the acquiring company has rights under the selling company’s pre-acquisition insurance policies. In corporate mergers, the predecessor’s assets (including its insurance coverage) and liabilities generally are transferred to the successor as a matter of law. The predecessor’s insurance coverage may also pass to the successor where there has been a de facto merger. However, in the context of other transactions, such as asset purchases, and in order to avoid ambiguity, the buyer should be clear about whether rights to insurance coverage under all of the selling company’s pre-acquisition insurance policies are also included among the assets being purchased, and a schedule of such policies should be included in the purchase agreement.
In considering issues of successor liability with respect to insurance policies, courts will often first consider the manner in which the liability is being imposed on the purchaser, i.e., whether the purchaser assumed the liability as a matter of contract or whether the liability is being imposed on the purchaser as a matter of law. A second inquiry is whether there exists a basis, either as a matter of contractual agreement or as a matter of law, to grant the successor a legally cognizable interest in insurance policies that were issued to and paid for by a predecessor company. Thus, even if the asset purchase agreement does not expressly acknowledge the intent to transfer rights to insurance coverage, such rights may transfer by operation of law absent express language to the contrary.
As discussed above, many insurance policies contain anti-assignment or other “change of control” provisions. Accordingly, before closing a deal, it may be prudent to review insurance policies for any anti-assignment or other limiting provisions. If anti-assignment provisions do exist, the acquiring company should request that the seller obtain the express written consent of the insurers to an assignment of the policies. Often insurers are slow to respond to such requests, and companies may not want to hold up the deal waiting for a response (which may be a denial). Under these circumstances, the due diligence team should consider the question of whether the anti-assignment provisions are likely to be enforced if consent is not obtained, particularly where the insurer’s refusal to consent is unreasonable.
Using Insurance to Close the Deal
Because transactions often move quickly and risks can be large and unknown, both buyers and sellers often consider using insurance as a means to protect themselves from liabilities relating to the deal itself and to help facilitate closing a transaction.
Representations and warranties (R&W) insurance is the most commonly known and widely used type of transactional insurance. Although insurers in the United Kingdom have been writing “warranty and indemnity” insurance since the late 1980s and there are some historical references to R&W policies existing in the United States in the late 1970s or early 1980s, R&W insurance did not become widely available in the United States until the last two decades and did not become widely used in the United States until even more recently. While R&W insurance was previously considered to be too expensive and the terms generally not favorable enough to justify the cost, it has now evolved into a risk mitigation tool that comes at a more reasonable cost for much broader coverage than previously offered.
In short, R&W insurance provides coverage for financial losses in the event that one or more of the seller’s representations or warranties is found to be incorrect post-closing, resulting in a breach of the purchase agreement. Either the buyer or the seller can be the insured, and there are two types of policies—buy-side policies and sell-side policies. These two types of policies have different functions and different coverage triggers. Further, because each deal is different, these policies are commonly customized and the terms vary significantly from policy to policy.
R&W insurance can augment or replace the seller’s duty to indemnify the buyer for a breach of a representation or warranty. This type of coverage could be desirable on the “buy side” where (1) a seller cannot or will not provide an indemnity (for example, where a seller is in financial distress or being liquidated); (2) a buyer is concerned about its ability to pursue claims for indemnification from the seller; (3) a buyer is motivated by strategic or financial concerns (such as in a competitive bidding situation or to avoid protracted negotiations); or (4) a buyer wants protection beyond its due diligence efforts.
R&W insurance may be desirable on the “sell side” where a seller wants to (1) “sweeten the deal” by offering a greater indemnity than it would be willing or able to provide; (2) “cap” indemnification exposure; or (3) augment its due diligence and disclosures.
The insurance market for this product has become well developed and many of the people who are involved in issuing these policies are former transactional attorneys. These policies can often be placed relatively quickly. To expedite placement of this coverage, the underwriting process has become streamlined.
Who pays for the coverage is often a function of which party receives the greatest benefit from the policy, and this is something that typically is negotiated during the course of the deal. In some instances, the seller pays for buy-side coverage for the buyer; in other cases, the buyer pays for sell-side coverage for the seller; or the buyer and seller may share the cost of the policy; or the buyer or seller may pay for their own policies. It just depends on the circumstances of the specific deal.
Currently, about 80 percent of R&W insurance being purchased is for buy-side coverage. Buy-side coverage is generally written as first-party coverage and, as such, it provides coverage directly to the buyer for losses that result from a breach. Sell-side policies provide third-party coverage in the event that the buyer makes a “claim” against the seller for breach of the purchase agreement’s representations and warranties.
Generally, sell-side policies do not provide coverage for a loss that is directly sustained by a seller—such as where there is some kind of issue with payment. Rather, these policies typically provide indemnification for defense costs and loss resulting from “claims” (as defined by the policy) made by the buyer for inaccuracies in the representations and warranties. Buying sell-side insurance acts as a backstop to the seller’s indemnity obligations. It reduces the risk of contingent liabilities arising from future representation and warranties claims, allowing sellers to lock in their return on investment. Further, sell-side R&W policies may be used to bridge the gap between parties where the seller wishes to reduce or eliminate the escrow or holdback requirement, and can reduce the seller’s negotiated indemnity obligation and escrow.
The scope of R&W coverage is generally determined by the seller’s representations and warranties in the relevant purchase agreement. Typically, the purchase agreement is made part of the policy application and policy itself, and the insurer’s obligations are limited to the insured representations and warranties. R&W policies may be issued as “blanket” or “single issue” policies. “Blanket” policies cover all of a seller’s representations and warranties, except as specifically excluded. In contrast, “single issue” policies cover only specified representations and warranties. To avoid disputes in the event that a policy is triggered, the purchase agreement should be structured in a way that all representations and warranties for which the parties are seeking coverage are appropriately labeled and disclosed to the insurer on the application.
As with all policies, it is important to review coverage limitations and exclusions during the process of negotiating R&W policies. R&W policies typically do not cover breaches or circumstances that could give rise to a breach that the insured had knowledge of prior to the inception of the policy. Further, they generally do not cover known issues, such as issues discovered during due diligence or described in the disclosure schedules.
In addition, R&W policies generally exclude coverage for post-closing covenants such as non-compete or non-solicitation provisions. However, indemnification provisions typically do cover breaches of post-closing covenants so these indemnity obligations may not be encompassed within the “representations or warranties” and arguably may not come within the scope of coverage. For example, if an indemnity obligation exists for covenants, this may not be considered a “representation” or “warranty” and could fall outside the scope of the policy. Accordingly, it is important to know whether an indemnity obligation is for a post-closing covenant and is not covered, or for a representation and warranty, so that it would be covered. Care should be taken to structure policies and deal terms according to the intent of the parties.
Generally, sell-side policies exclude coverage for a seller’s fraud (insureds generally cannot get coverage for their own intentional wrongful acts). However, these types of breaches are generally covered in buyer-side policies and are often an important reason for purchasing them. There also may be deal-specific exclusions included in a policy where the insurer sees something in its due diligence—e.g., environmental liabilities. Policies may also contain exclusions for Federal Corrupt Practices Act (FCPA) violations, certain tax representations (in particular taxes, in certain foreign jurisdictions), and certain securities law violations in respect of the target’s publicly traded securities (which may be covered under an entity’s existing D&O policies).
There are certain other insurance products that are seen with some frequency in the transactional context that are often purchased in addition to R&W insurance, or sometimes separately, depending on the circumstances of the transaction. Tax liability insurance indemnifies the insured party for taxes, interest, penalties, and contest costs if the relevant tax authorities—whether federal, state, local, or foreign—do not respect the insured tax positions, especially when the amounts at risk are large and the price to transfer risk is low. Because R&W policies are intended to cover unknown risks (e.g., unexpected breaches of the tax representations), during the underwriting process insurers may seek to exclude coverage for any scheduled tax items and liabilities, or any heightened tax issues that are “red flagged” in the tax due diligence report (and viewed by the insurer as high risk). In such instances, tax insurance policies may be used to cover one or several specific tax risks and address known, material tax issues, which the insurers generally contend are outside the scope of a R&W policy.
Loss mitigation insurance (also referred to as contingent liability insurance) is another type of insurance used in transactions. It provides coverage for known, but not yet quantifiable, risks. For example, litigation mitigation insurance can provide coverage for threatened or pending litigation and known claims. Put simply, it eliminates post-closing concerns relating to existing lawsuits. It is typically used for securities litigation, intellectual property claims and litigation, environmental liability, successor liability, preservation of prevailing party judgments, and breach of contract claims.
Pollution legal liability insurance is generally stand-alone pollution coverage. It can be modified to insure the representations, warranties, and indemnities in a transaction that relate to unknown environmental liabilities. Loss portfolio transfer insurance allows a buyer or seller to bundle up a company’s workers’ compensation, D&O, and general liability claims incurred before a transaction and transfer those claims to an insurer at a fixed cost.
When managed properly, insurance can be one of a company’s most valuable assets. Many important insurance-related issues may need to be addressed during the course of a merger or acquisition. To help prevent post-acquisition problems and ensure the success of a deal, the parties to a transaction should understand and address insurance issues before and during the transaction, rather than address the unintended consequences after closing.
Amy J. Fink is a partner with Jones Day, Los Angeles.
 See Foster v. Cone-Blanchard Mach. Co., 460 Mich. 696, 702 (1999).
 See Columbia Propane, LP v. Wis. Gas Co., 261 Wis. 2d 70, 90 (2003).
 See Columbia Propane, LP, 261 Wis. 2d at 90; Lockheed Martin Corp. v. Gordon, 16 S.W.3d 127, 134 (Tex. App. 2000).
 See N. Ins. Co. of N.Y. v. Allied Mut. Ins. Co., 955 F.2d 1353, 1357–58 (9th Cir. 1992).
 General Accident Ins. Co. v. Superior Court of Alameda Cty., 55 Cal. App. 4th 1444, 1455 (1997).
 State Farm Fire & Cas. Co. v. King Sports, Inc., 827 F. Supp. 2d 1364, 1379 (N.D. Ga. 2011).
 Quemetco Inc. v. Pac. Auto. Ins. Co., 24 Cal. App. 4th 494, 503 (1994).
 See Emp’rs Mut. Liab. Ins. Co. v. Mich. Mut. Auto. Ins. Co., 101 Mich. App. 697, 702 (1980); Tex. Farmers Ins. Co. v. Gerdes, 880 S.W.2d 215, 218 (Tex. App. 1994); Greco v. Or. Mut. Fire Ins. Co., 191 Cal. App. 2d 674, 682 (1961).
 Travelers Indem. Co. v. Israel, 354 F.2d 488 (2d Cir. 1965).
 See, e.g., Dallas Cty. Hosp. Dist. v. Pioneer Cas. Co., 402 S.W. 2d 287 (Tex. App. 1966) (holding insurer was not bound by assignment of policy to hospital and was within its rights when it discharged its liability under “medical payments” coverage by payment directly to the insured, leaving the hospital without payment).
 See N. Ins. Co. of N.Y. v. Allied Mut. Ins. Co., 955 F.2d 1353 (9th Cir. 1992); Brunswick Corp. v. St. Paul Fire & Marine Ins. Co., 509 F. Supp. 750 (E.D. Pa. 1981).
 See Columbia Propane, LP v. Wis. Gas Co., 261 Wis. 2d 70, 90 (2003).
 See Beatrice Co. v. State Bd. of Equalization, 6 Cal. 4th 767, 778 (1993); Ray v. Alad Corp., 19 Cal. 3d 22, 28 (1977).
 See, e.g., Nat’l Disc. Shoes, Inc. v. Royal Globe Ins. Co., 99 Ill. App. 3d 54 (1981).
 Trubowitch v. Riverbank Canning Co., 30 Cal. 2d 335, 339–40 (1947); Westoil Terminals Co. v. Harbor Ins. Co., 73 Cal. App. 4th 634, 641 (1999).
 Young v. Chi. Fed. Sav. & Loan Ass’n, 180 Ill. App. 3d 280 (1989).
 See, e.g., Globecon Grp., LLC v. Hartford Fire Ins. Co., 434 F.3d 165, 171 (2d Cir. 2006) (“[W]hile the insurance policy contains a provision that the ‘[a]ssignment of this policy is not valid without [defendant’s] written consent,’ this anti-assignment provision applies only to assignments before loss.”); Travelers Indem. Co. v. Israel, 354 F. 2d 488, 490 (2d Cir. 1965); Fluor Corp. v. Superior Court of Orange Cty., 61 Cal. 4th 1175, 1224 (2015) (“[A]fter personal injury (or property damage) resulting in loss occurs within the time limits of the policy, an insurer is precluded from refusing to honor an insured’s assignment of the right to invoke defense or indemnification coverage regarding that loss. . . . This result obtains even without consent by the insurer—and even though the dollar amount of the loss remains unknown or undetermined until established later by a judgment or approved settlement.”); Kittner v. E. Mut. Ins. Co., 915 N.Y.S. 2d 666 (2011);Citizens Prop. Ins. Corp. v. Ifergane, 114 So. 3d 190, 195 (Fla. Dist. Ct. App. 2012); Ardon Constr. Corp. v. Firemen’s Ins. Co. of Newark, N.J., 16 Misc. 2d 483, 488 (N.Y. Sup. Ct. Kings Cty. 1959).
 See, e.g., Conrad Bros. v. John Deere Ins. Co., 640 N.W.2d 231, 237 (Iowa 2001) (noting the weight of authority supporting the same rule and citing cases from Arizona, Delaware, Florida, Illinois, Michigan, Missouri, New Jersey, North Carolina, Pennsylvania, Texas, Washington, West Virginia, and Wisconsin).
 Viola v. Fireman’s Fund Ins. Co., 965 F. Supp. 654, 658 (E.D. Pa. 1997).
 Viola, 965 F. Supp. at 659; Smith v. Buege, 387 S.E. 2d 109, 116 (W. Va. 1989).
 See Lee R. Russ & Thomas F. Segalla, 3 Couch on Insurance § 35:7 (3d ed. 2005); Richard A. Lord, 29 Williston on Contracts § 74:22 (4th ed.); 44 Am Jur. 2d Insurance § 787.
 In re Katrina Breaches, 63 So. 3d 955, 964 (La. 2011).
 See Keller Founds., Inc. v. Wausau Underwriters Ins. Co., 626 F. 3d 871, 875–76 (5th Cir. 2010).
 Choi v. Century Sur. Co., 2010 U.S. Dist. LEXIS 101689, at *4 (S.D. Tex. Sept. 27, 2010) (citing Tex. Dev. Co. v. Exxon Mobil Corp., 119 S.W.3d 875, 880 (Tex. App. 2003) (citing Reef v. Mills Novelty Co., 89 S.W.2d 210, 211 (Tex. App. 1936)).
 See, e.g., Montrose Chem. Corp. v. Admiral Ins. Co., 10 Cal. 4th 645, 664 (1995).
 See, e.g., Textron, Inc. v. Liberty Mut. Ins. Co., 639 A.2d 1358 (R.I. 1994) (Liberty Mutual issued policies that were a hybrid of “occurrence” and “claims-made” polices as a result of an amendatory endorsement stating that “if the insured, at the time a claim is made against it, is no longer covered by a liability policy issued by the company, this policy shall not apply under Coverage B to injury to or destruction of property, including the loss of use thereof, which is caused by exposure to conditions over a period of days, weeks, months, or longer and which is not reported by the insured to the company within one year after the policy period.”).
 See, e.g., Cal. Corp. Code § 1107(a); Quemetco Inc. v. Pac. Auto. Ins. Co., 24 Cal. App. 4th 494, 503 (1994).
 See Westoil Terminals Co. v. Harbor Ins. Co., 73 Cal. App. 4th 634, 640 (1999).
 See Albert Bates, Jr. IV, D. Matthew Jameson III & Brent J. Pomponio, “Asset Purchases, Successor Liability, and Insurance Coverage: Does the Tail Always Follow the Dog?,” 100 W. Va. L. Rev. 631 (1998)