Two insurance companies are now at odds after a coverage dispute led one to take the other to court over who should pay legal costs.
The Cincinnati Specialty Underwriters Insurance Company filed a lawsuit against Southwest Marine and General Insurance Company on February 4, 2026. Cincinnati claims Southwest wrongly refused to defend a property owner under an additional insured agreement. The case is in the U.S. District Court for the Southern District of New York.
It all stems from a workplace accident back in January 2023. Ashley Ryan, working for contractor Howard M. Haines Inc., was injured while using a table saw at a building in Manhattan. Ryan suffered serious injuries to his left hand and sued the property owner, Pamela Equities Corp., and its operator, Pan Am Equities, Inc., in New York state court. He’s seeking about $1.26 million in damages.
Pan Am has a liability insurance policy with Cincinnati, offering $1 million per occurrence and $2 million total. However, Cincinnati argues that Southwest’s policy, held by the contractor Haines, should pay first. Southwest’s coverage has higher limits: $2 million per occurrence and $4 million total for bodily injury.
Southwest’s policy includes an endorsement extending coverage to additional insureds when a written construction agreement requires it. Haines signed such an agreement in March 2021, naming the property owner and affiliates as additional insureds on their liability coverage.
Cincinnati says Pan Am qualifies under this endorsement. When Pan Am asked Southwest in October 2023 to provide defense and indemnity, Southwest declined. Cincinnati has since been covering Pan Am’s legal defense costs and now wants the court to order Southwest to reimburse those expenses and handle the claim going forward.
No final ruling has been made yet. But this case highlights a common issue in insurance: additional insured endorsements may sound straightforward but can lead to costly disputes when claims arise. Insurers and risk handlers will be watching this one closely.