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Markel must cover under deductible in the event of a plant explosion



The Mississippi Supreme Court overturned a lower court ruling on Thursday, ruling that a Markel Corp. unit must provide coverage under its surplus policy for a plant explosion in 2014.

On July 28, 2014, an explosion occurred at Omega Protein Inc.'s facility. in Moss Point, Mississippi, killed one man and seriously injured several others, according to Thursday's decision by the state Supreme Court in Omega Protein Inc. v. Evanston Insurance Co.

Omega Protein Inc. had entered into a principal service agreement 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 designating Omega as an additional insured,

Accu-fab purchased $ 1

million primary insurance issued by Argo Group International Holdings Ltd. Colony Insurance Co. and a $ 5 million surplus insurance from Markel Evanston Insurance.

Litigated. ion followed, and Omega and the deceased worker's estate settled, with Colony contributing $ 1 million, an amount equal to the applicable insurance limits.

Evanston filed a claim for summary judgment, arguing that Omega was not an extra insured under the Colony insurance and therefore not an extra insured under the deductible, and that a pollution exclusion in its insurance applied. The lower court upheld the claim and Omega appealed.

In its unanimous opinion on reversing the lower court, the Mississippi Supreme Court stated: insured by allowing coverage.

"Furthermore, we find that the issue of coverage was triggered is governed by the language of the agreement and that Evanston has failed to prove that there could be no coverage under the deductible policy," the court said, revoking the district court's granting the summary judgment and remanded the case for further proceedings.

Actors in the case did not respond to requests for comment.

In a case related to Omega's coverage in the explosion. In 2019, a federal appellate court referred to advice from the Mississippi Supreme Court and upheld a lower court ruling in favor of a Swiss Re Ltd. entity in a dispute with Colony.

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