US Ailing


Your deductible theory (see No Claim, lower this page) on why US Ailing has not submitted an insurance claim for the Rios-Hall litigation doesn’t make any sense either. I’m an insurance coverage lawyer and I can tell you that most policies provide that the insurer will defend the insured against legal action (or arbitration, etc.) without regard for the deductible.

The only time that doesn’t happen is when the policy has a Self-Insured Retention (like a deductible, but different). Those usually come with a provision that the carrier doesn’t pay for anything, including the defense, below a certain amount ($250,000 to $500,000 is common). Self-Insured retentions are rare on professional policies like D&O and E&O.

My suspicion is that US Sailing thought it would cost less to pay this out of pocket than the increase in premiums a claim would trigger. That was apparently a miscalculation. And they got the added benefit of being able to control the defense and pick the lawyers/arbitrators rather than leaving that in the hands of an insurance company who doesn’t know beans about sailing or care who goes to the Olympics. Keeping the defense in house would make sure the Olympic agenda was served.

The only other options that make sense are that they (1) don’t have insurance that covers this sort of liability; or (2) their insurance company denied coverage and it’s easier to sue Hall than the insurer. If the second one is true, US Sailing needs to get some new lawyers. – Deck Ape.