First Mercury Insurance v. Jeffrey and Anita Russell

IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA
September 2017 Term
FILED
October 19, 2017
released at 3:00 p.m.
No. 16-0596 RORY L. PERRY, II CLERK
SUPREME COURT OF APPEALS
OF WEST VIRGINIA
FIRST MERCURY INSURANCE COMPANY, INC.,
Defendant Below, Petitioner
V.
JEFFREY RUSSELL AND ANITA RUSSELL,
Plaintiffs Below, Respondents,
and
KIMES STEEL, INC.,
Defendant Below, Respondent
Appeal from the Circuit Court of Mason County
Honorable David W. Nibert, Judge
Civil Action No. 14-C-18
AFFIRMED
Submitted: September 12, 2017
Filed: October 19, 2017
Don C. A. Parker Brent K. Kesner
Charity K. Lawrence Ernest G. Hentschel, II
Spilman Thomas & Battle, PLLC Kesner & Kesner, PLLC
Charleston, West Virginia Charleston, West Virginia
Attorneys for the Petitioner, Attorneys for the Respondents,
First Mercury Insurance Company Jeffrey and Anita Russell
Kevin A. Nelson
Ashley W. French
Dinsmore & Shohl, LLP
Charleston, West Virginia
Attorneys for the Respondent,
Kimes Steel, Inc.
JUSTICE DAVIS delivered the Opinion of the Court.
SYLLABUS BY THE COURT
1. “A circuit court’s entry of summary judgment is reviewed de novo.”
Syllabus point 1, Painter v. Peavy, 192 W. Va. 189, 451 S.E.2d 755 (1994).
2. “‘“A motion for summary judgment should be granted only when it
is clear that there is no genuine issue of fact to be tried and inquiry concerning the facts is
not desirable to clarify the application of the law.” Syllabus Point 3, Aetna Casualty &
Surety Co. v. Federal Insurance Co. of New York, 148 W. Va. 160, 133 S.E.2d 770(1963).’ Syllabus Point 1, Andrick v. Town of Buckhannon, 187 W. Va. 706, 421 S.E.2d
247 (1992).” Syllabus point 2, Painter v. Peavy, 192 W. Va. 189, 451 S.E.2d 755 (1994).
3. “The interpretation of an insurance contract, including the question
of whether the contract is ambiguous, is a legal determination that, like a lower court’s
grant of summary judgment, shall be reviewed de novo on appeal.” Syllabus point 2,
Riffe v. Home Finders Associates, Inc., 205 W. Va. 216, 517 S.E.2d 313 (1999).
4. “Employers’ liability insurance applies to actions brought by an
employee against an employer, when the employer and the employee are not entitled to
the benefits and protections under any workers’ compensation law, or when, even though
i
covered by a workers’ compensation law, the employee has a right to bring an action for
common law damages against the employer.” Syllabus point 3, Erie Insurance Property
& Casualty Co. v. Stage Show Pizza JTS, Inc., 210 W. Va. 63, 553 S.E.2d 257 (2001).
5. “It is well settled law in West Virginia that ambiguous terms in
insurance contracts are to be strictly construed against the insurance company and in
favor of the insured.” Syllabus point 4, National Mutual Insurance Co. v. McMahon &
Sons, Inc., 177 W. Va. 734, 356 S.E.2d 488 (1987), overruled on other grounds by
Parsons v. Halliburton Energy Services, Inc., 237 W. Va. 138, 785 S.E.2d 844 (2016).
6. “Where ambiguous policy provisions would largely nullify the
purpose of indemnifying the insured, the application of those provisions will be severely
restricted.” Syllabus point 9, National Mutual Insurance Co. v. McMahon & Sons, Inc.,
177 W. Va. 734, 356 S.E.2d 488 (1987), overruled on other grounds by Parsons v.
Halliburton Energy Services, Inc., 237 W. Va. 138, 785 S.E.2d 844 (2016).
7. “Where the policy language involved is exclusionary, it will be
strictly construed against the insurer in order that the purpose of providing indemnity not
be defeated.” Syllabus point 5, National Mutual Insurance Co. v. McMahon & Sons, Inc.,
ii
177 W. Va. 734, 356 S.E.2d 488 (1987), overruled on other grounds by Parsons v.
Halliburton Energy Services, Inc., 237 W. Va. 138, 785 S.E.2d 844 (2016).
iii
Davis, Justice:
This appeal was brought by the Petitioner, First Mercury Insurance
Company, Inc. (“First Mercury”), defendant below, from an order of the Circuit Court of
Mason County that denied First Mercury’s motion for partial summary judgment and, in
turn, granted partial summary judgment as to coverage to Respondents Jeffrey Russell
and Anita Russell (“Mr. Russell” or “the Russells”), plaintiffs below, and Respondent
Kimes Steel, Inc. (“Kimes Steel”), defendant below. The dispositive issue herein is
whether coverage exists for a statutory deliberate intent action when the employer’s
commercial general liability policy is amended by an endorsement that includes a “Stop
Gap – Employers Liability Coverage Endorsement – West Virginia” that expressly
provides coverage for bodily injury to employees, as well as an exclusion for statutory
deliberate intent claims. After careful review of the circuit court’s order, the briefs, the
record submitted on appeal, and the oral arguments of the parties, we find the policy at
issue in this case to be internally inconsistent and therefore ambiguous. Accordingly, we
interpret the policy in favor of the insured and affirm the circuit court’s partial summary
judgment rulings.
1
I.
FACTUAL AND PROCEDURAL HISTORY
In 2012, Kimes Steel sought to purchase various types of insurance
coverage in order to meet the insurance requirements for a potential client contract with
James River Coal. Specifically, among other things, James River Coal required
$1,000,000.00 of coverage for commercial general liability (“CGL”) (combined single
limit) and employer’s liability (per accident), and $5,000,000.00 of excess liability
coverage. Mr. Shannon Kimes, the principal of Kimes Steel, worked with an independent
insurance agent who solicited quotes for the required insurance coverage based upon a list
provided by James River Coal.1 Ultimately, First Mercury, a surplus lines carrier,2
responded to the solicitation by submitting a bid to provide the coverage required by
James River Coal.
Thereafter, Kimes Steel purchased two insurance policies from First
Mercury. The first policy purchased from First Mercury provides primary CGL coverage.
1
James River Coal also required workers’ compensation coverage. Kimes Steel
previously maintained a basic workers’ compensation and employer’s liability insurance
policy with BrickStreet Mutual Insurance Company (“BrickStreet”). In order to comply with
James River Coal’s liability requirements as to workers’ compensation, Kimes Steel
increased its limits of liability with BrickStreet.
2
A surplus lines carrier is an insurance company that is not admitted or not
licensed to engage in insurance business in West Virginia. See W. Va. Code §§ 33-12C-3(e),
(p), and (w) (2011) (Repl. Vol. 2017).
2
The second policy purchased provides excess coverage. The First Mercury CGL policy
contains a standard exclusion for employer’s liability for injuries to employees. However,
the standard exclusion is modified by an endorsement identified as “Stop Gap –
Employers Liability Coverage Endorsement – West Virginia” (“Stop Gap”).3 The First
Mercury excess policy includes a standard “follow form” provision, which incorporates
the terms of the underlying policy.
The two First Mercury policies were in place when Mr. Russell was
involved in a workplace accident at Kimes Steel on May 3, 2013. The accident resulted
in severe injuries to Mr. Russell’s dominant hand and the amputation of a finger. On
February 4, 2014, the Russells filed their complaint alleging that Kimes Steel acted with
“deliberate intention” as defined in W. Va. Code § 23-4-2 (2005) (Repl. Vol. 2010).4 The
Russells alleged that Kimes Steel required its employee, Jeffrey Russell, to perform his
job duties without required safety equipment, instructions, and precautions for working
3
In fact, the Kimes Steel application for the CGL policy specifically requested
stop gap coverage.
4
Pursuant to W. Va. Code § 23-4-2(c) (2005) (Repl. Vol. 2010), a cause of
action may be had against an employer “[i]f injury or death result to any employee from the
deliberate intention of his or her employer to produce the injury or death. . . .” The statutory
elements required to prevail in a claim for deliberate intent are set out in W. Va. Code
§ 23-4-2(d)(2)(ii). This statute was amended effective June 12, 2015. Thus, we cite to the
statute in effect at the time of Mr. Russell’s injury in 2013.
3
with table saws, and subjected him to a specific unsafe working condition that presented a
high degree of risk and strong probability of serious injury or death.
First Mercury issued a denial of coverage letter to Kimes Steel on May 5,
2014. The letter informed Kimes Steel that First Mercury would “not provide . . . a legal
defense to the lawsuit, nor [would] it indemnify Kimes Steel as to any damages for which
Kimes Steel may be liable to Jeffrey or Anita Russell.” First Mercury also filed a
declaratory judgment action in the United States District Court for the Southern District
of West Virginia seeking a declaration that the policies provide no coverage for the
Russells’ claims. The declaratory judgment action was dismissed by the district court.
Thereafter, in June 2014, the Russells amended their complaint by adding a declaratory
judgment claim against First Mercury alleging that First Mercury is obligated to provide a
defense and indemnification to Kimes Steel under the subject insurance policies. In
October 2014, Kimes Steel filed a cross-claim against First Mercury asserting breach of
contract and bad faith arising from First Mercury’s denial of coverage to Kimes Steel
with respect to the Russells’ claims.
On March 18, 2015, the circuit court entered an agreed order vacating a
previously entered scheduling order and staying discovery of the underlying Russell tort
claim allegations pending resolution of the coverage issues. Subsequently, First Mercury
4
moved for partial summary judgment on the coverage issues. Kimes Steel and the
Russells responded by also filing separate motions for partial summary judgment as to the
coverage issues.
Following briefing and arguments, the circuit court entered its May 18,
2016, “Order Denying Defendant First Mercury Insurance Company’s Motion for Partial
Summary Judgment and Granting Plaintiffs’ Cross-Motion and Defendant Kimes Steel’s
Motion for Partial Summary Judgment on Coverage Issues.” The circuit court’s order can
be summarized as finding coverage based upon its conclusion that the Stop Gap
endorsement language is ambiguous with respect to covering the Russells’ deliberate
intent action. Additionally, the circuit court concluded that Kimes Steel had a reasonable
expectation of coverage for the Russells’ claims, that the policy language rendered the
stop gap coverage illusory, that First Mercury was estopped from denying coverage, and,
further, that First Mercury owed a duty to defend Kimes Steel. It is from this order that
First Mercury now appeals.
II.
STANDARD OF REVIEW
First Mercury appeals the order of the circuit court granting partial
summary judgment in favor of the Russells and Kimes Steel and denying First Mercury’s
5
motion for partial summary judgment. It is well settled that “[a] circuit court’s entry of
summary judgment is reviewed de novo.” Syl. pt. 1, Painter v. Peavy, 192 W. Va. 189,
451 S.E.2d 755 (1994). In undertaking our de novo review, we apply the same standard
for granting summary judgment that is applied by the circuit court:
“‘A motion for summary judgment should be granted
only when it is clear that there is no genuine issue of fact to be
tried and inquiry concerning the facts is not desirable to
clarify the application of the law.’ Syllabus Point 3, Aetna
Casualty & Surety Co. v. Federal Insurance Co. of New York,
148 W. Va. 160, 133 S.E.2d 770 (1963).” Syllabus Point 1,
Andrick v. Town of Buckhannon, 187 W. Va. 706, 421 S.E.2d
247 (1992).
Syl. pt. 2, Painter, 192 W. Va. 189, 451 S.E.2d 755.
Additionally, it is well recognized that “[t]he interpretation of an insurance
contract, including the question of whether the contract is ambiguous, is a legal
determination that, like a lower court’s grant of summary judgment, shall be reviewed de
novo on appeal.” Syl. pt. 2, Riffe v. Home Finders Assocs. Inc., 205 W. Va. 216, 517
S.E.2d 313 (1999). Mindful of the de novo standard governing our review, we proceed to
consider the substantive issues raised.
6
III.
DISCUSSION
First Mercury advances four assignments of error challenging the circuit
court’s conclusion that the Stop Gap endorsement and related exclusion were ambiguous.
On the other hand, the Russells and Kimes Steel assert that the circuit court properly
found First Mercury’s policy to be inherently ambiguous. Accordingly, this appeal is
resolved by considering the policy language.5
The First Mercury CGL policy issued to Kimes Steel contains a typical
insuring agreement accompanied by an exclusion of coverage for bodily injury to an
employee.6 Neither of these provisions is disputed in this appeal. This case turns on a
5
First Mercury raises additional assignments challenging the circuit court’s
rulings pertaining to the doctrine of reasonable expectations, illusory coverage, estoppel, and
First Mercury’s duty to defend. Because this appeal is resolved by the policy language, it is
unnecessary to address these issues. See infra note 8.
6
“Section I” of the First Mercury CGL policy, under the heading “Coverage A
Bodily Injury and Property Damage Liability,” provides:
1. Insuring Agreement
a. We will pay those sums that the insured becomes
legally obligated to pay as damages because of
“bodily injury” or “property damage” to which
this insurance applies. We will have the right and
duty to defend the insured against any “suit”
seeking those damages. However, we will have
no duty to defend the insured against any “suit”
seeking damages for “bodily injury” or “property
(continued...)
7
stop gap endorsement appended to the CGL policy and titled “Stop Gap – Employers
Liability Coverage Endorsement – West Virginia.” The Stop Gap endorsement modifies
the exclusion of bodily injury coverage to an employee that is contained in the First
Mercury CGL policy. The Stop Gap endorsement provides, in relevant part:
A. The following is added to Section I – Coverages:
COVERAGE – STOP GAP – EMPLOYERS
LIABILITY
1. Insuring Agreement
a. We will pay those sums that the insured
becomes legally obligated by West
Virginia Law to pay as damages because
of “bodily injury by accident” or “bodily
injury by disease” to your “employee” to
which this insurance applies. . . .
6
(...continued)
damage” to which this insurance does not
apply. . . .
The policy goes on to set out the following exclusion:
2. Exclusions
This insurance does not apply to:
....
e. Employer’s Liability
“Bodily injury” to:
(1) An “employee” of the insured
arising out of and in the course of:
(a) Employment by the insured; or
(b) Performing duties related to the
conduct of the insured’s business[.]
8
To put into perspective the Stop Gap endorsement set out above, it is
important to first understand the meaning this Court has ascribed to the term “stop gap”
coverage. This Court addressed that term in Erie Insurance Property & Casualty Co. v.
Stage Show Pizza, JTS, Inc., 210 W. Va. 63, 553 S.E.2d 257 (2001), wherein the Court
observed that, “[i]n many states, insurance companies offer businesses three types of
insurance coverage: commercial general liability coverage; workers’ compensation
coverage; and ‘stop gap’ employers’ liability coverage.” Id. at 67, 553 S.E.2d at 261. In
explaining the three coverage types, the Court noted that a CGL policy protects a business
against a variety of liability claims but typically does not provide coverage for employee
bodily injury arising out of employment. Id. As to workers’ compensation coverage, the
Court observed that “[w]orkers’ compensation coverage is designed to release both an
employer and its employees from common-law rules of liability and damage, protect an
employer from expensive and unpredictable litigation, and provide compensation for
injuries to employees without the burdensome requirements of proving common-law
negligence.” Id. at 68, 553 S.E.2d at 262 (citing Jones v. Laird Found., Inc., 156 W. Va.
479, 489, 195 S.E.2d 821, 827 (1973) (Sprouse, J., concurring)). Finally, the Court in
Stage Show Pizza recognized that “[b]etween these two types of protection lies a ‘gap’ in
coverage. In this gap are claims made against a business by injured employees whose
claims are not generally compensable under the workers’ compensation system.” 210
W. Va. at 68, 553 S.E.2d at 262. Significantly, the Court described employers’ liability
9
stop gap coverage as the gap filler intended for the purpose of providing coverage for
employers when employees are able to bring an action for injury despite workers’
compensation immunity. Id. Pertinent to the instant case, the Court expressly held:
Employers’ liability insurance applies to actions
brought by an employee against an employer, when the
employer and the employee are not entitled to the benefits and
protections under any workers’ compensation law, or when,
even though covered by a workers’ compensation law, the
employee has a right to bring an action for common law
damages against the employer.
Syl. pt. 3, Stage Show Pizza, 210 W. Va. 63, 553 S.E.2d 257. See also Luikart v. Valley
Brook Concrete & Supply, Inc., 216 W. Va. 748, 754, 613 S.E.2d 896, 902 (2005) (per
curiam) (recognizing “stop gap employers’ liability policy exists to cover ‘claims made
against a business by injured employees whose claims are not generally compensable
under the workers’ compensation system’” (quoting Stage Show Pizza, 210 W. Va. at 68,
553 S.E.2d at 262)).
With this understanding of the meaning of stop gap coverage, we consider
the language of the First Mercury Stop Gap endorsement. We first note that the coverage
endorsement, which undisputedly modifies the insuring agreement in the First Mercury
CGL policy, expressly utilizes the term “Stop Gap” in its heading: “Coverage – Stop Gap
– Employers Liability.” Pursuant to West Virginia law as described above, the utilization
of the term “Stop Gap” in this heading plainly indicates that the policy provides Kimes
10
Steel with coverage for a deliberate intent action brought by an employee. However, the
language that follows attempts to limit coverage to “‘bodily injury by accident’ or ‘bodily
injury by disease’ to your ‘employee’ to which this insurance applies. . . .” (Emphasis
added). Thus, the more prominently displayed heading to this provision conveys a clear,
yet different, message than the policy language that follows.
The heading indicates that the policy provides stop gap coverage, which,
under West Virginia law, plainly means coverage for “claims made against a business by
injured employees whose claims are not generally compensable under the workers’
compensation system.” Stage Show Pizza, 210 W. Va. at 68, 553 S.E.2d at 262.
Nevertheless, the policy language purports to limit employee claims to only those arising
“by accident” or “disease.” Under these circumstances, we find this portion of the Stop
Gap endorsement to be ambiguous. Accordingly, this provision must be interpreted in
favor of Kimes Steel, and we find that it provides coverage for the Russells’ deliberate
intent claims. “It is well settled law in West Virginia that ambiguous terms in insurance
contracts are to be strictly construed against the insurance company and in favor of the
insured.” Syl. pt. 4, National Mut. Ins. Co. v. McMahon & Sons, Inc., 177 W. Va. 734,
356 S.E.2d 488 (1987), overruled on other grounds by Parsons v. Halliburton Energy
Servs., Inc., 237 W. Va. 138, 785 S.E.2d 844 (2016). Accord Riffe v. Home Finders
11
Assocs., Inc., 205 W. Va. 216, 221, 517 S.E.2d 313, 318 (1999). However, our analysis
does not end here.
The Stop Gap endorsement in the First Mercury policy also contains its own
exclusionary language providing, in relevant part in Exclusion l, as follows:
2. Exclusions
This insurance does not apply to:
....
l. West Virginia Workers Compensation Law,
Sect. 23-4-2
“Bodily injury by accident” or “bodily injury by
disease” caused by any action determined to be
of deliberate intention as specified under West
Virginia Workers Compensation Law, Sect. 23­
4-2.
As First Mercury correctly notes, the case of West Virginia Employers’
Mutual Insurance Co. v. Summit Point Raceway Associates, Inc., 228 W. Va. 360, 719
S.E.2d 830 (2011), is directly on point with a similar exclusion and unquestionably
controls our analysis of this language. In Summit Point, this Court considered the
following exclusionary language:
C. Exclusions
This insurance does not cover
12
5. Bodily injury caused by your intentional,
malicious or deliberate act, whether or not the act was
intended to cause injury to the employee injured, or
whether or not you had actual knowledge that an injury
was certain to occur, or any bodily injury for which
you are liable arising out of West Virginia Annotated
Code § 23-4-2.
Id., 228 W. Va. at 372, 719 S.E.2d at 842. The Summit Point Court first acknowledged
West Virginia law pertaining to exclusionary clauses. In this regard, it has been
established that
[a]n insurer wishing to avoid liability on a policy
purporting to give general or comprehensive coverage must
make exclusionary clauses conspicuous, plain, and clear,
placing them in such a fashion as to make obvious their
relationship to other policy terms, and must bring such
provisions to the attention of the insured.
Syl. pt. 6, id. (internal quotations and citations omitted). With respect to the exclusionary
language at issue therein, the Court in Summit Point then concluded that the
exclusion was conspicuous, plain, clear, and obvious in
excluding coverage for deliberate intent actions. By stating
that the insurance did not cover “any bodily injury for which
you are liable arising out of West Virginia Annotated Code §
23-4-2,” it is clear that there was no coverage for deliberate
intent liability. . . .
228 W. Va. at 373, 719 S.E.2d at 843. Our examination of the similarly worded language
used in First Mercury’s exclusion compels the same conclusion. The language used in
First Mercury’s Exclusion l, which expressly excludes coverage for “any action
determined to be of deliberate intention as specified under West Virginia Workers
13
Compensation Law, Sect. 23-4-2,” is “plain, clear, and obvious in excluding coverage for
deliberate intent actions.” Summit Point, 228 W. Va. at 373, 719 S.E.2d at 843.
Thus, our analysis of the First Mercury policy issued to Kimes Steel reveals
that it contains a Stop Gap endorsement that provides coverage for deliberate intent
actions, and an accompanying plain and clear exclusion denying the very same coverage.
The inclusion of both the Stop Gap endorsement and Exclusion l in the First Mercury
policy creates an additional ambiguity.7 As noted above, “ambiguous terms in insurance
contracts are to be strictly construed against the insurance company and in favor of the
insured.” Syl. pt. 4, in part, McMahon & Sons, Inc., 177 W. Va. 734, 356 S.E.2d 488.
Indeed, in McMahon & Sons, we concluded that “[w]here ambiguous policy provisions
7
Thus, this case differs substantially from Summit Point to the extent that there
was no ambiguity in the Summit Point policy. See West Virginia Emp’rs’ Mut. Ins. Co. v.
Summit Point Raceway Assocs., Inc., 228 W. Va. 360, 372, 719 S.E.2d 830, 842 (2011)
(“Nothing in the plain language quoted above leads to a reasonable conclusion that deliberate
intent coverage is included in this policy.”). Furthermore, the language of the policy in
Summit Point did not include any reference to stop gap coverage. It was made clear that the
employer in Summit Point did not pay a premium to obtain deliberate intent coverage and,
therefore, did not have such coverage. Id. at 371 n.14, 719 S.E.2d at 841 n.14 (stating “[i]t
is undisputed that Summit Point did not have [deliberate intent] coverage, and Summit Point
never paid any premiums to obtain such coverage” (emphasis added)).
Here, Kimes Steel sought coverage through an agent; First Mercury made an
offer of CGL coverage with a Stop Gap endorsement; an application specifying stop gap
coverage was completed; Kimes Steel paid the premium; and First Mercury accepted the
premium. Thus, it is clear from the parties’ own actions that the terms of the policy were
conflicting and ambiguous.
14
would largely nullify the purpose of indemnifying the insured, the application of those
provisions will be severely restricted.” Syl. pt. 9, id. Moreover, this Court specifically
held that “[w]here the policy language involved is exclusionary, it will be strictly
construed against the insurer in order that the purpose of providing indemnity not be
defeated.” Syl. pt. 5, id. This circumstance compels the conclusion that the exclusionary
language is inherently inconsistent with the Stop Gap endorsement providing coverage
such that it nullifies the purpose of the policy endorsement and operates so as to defeat
indemnification. See, e.g., Cramer v. National Cas. Co., 690 F. App’x 135, 138 (4th Cir.
2017) (“[A]mbiguous or conflicting terms in an insurance policy must be construed
liberally in favor of the insured and strictly against the insurer.” (internal quotations and
citation omitted)); Diamond State Ins. Co. v. Homestead Indus., Inc., 318 S.C. 231, 236,
456 S.E.2d 912, 915 (1995) (same).
By purporting to exclude deliberate intent actions from the Stop Gap
endorsement, the First Mercury policy largely nullifies the purpose of the coverage, which
is to fill the gap in the CGL policy and provide protection for employees’ bodily injury
claims. Such ambiguous policy language must be construed against the insurance
company and in favor of the insured so as to support the purpose of indemnity. Syl. pts. 4
& 9, McMahon & Sons, Inc., 177 W. Va. 734, 356 S.E.2d 488. Thus, we find that the
First Mercury explicitly titled Stop Gap endorsement operates to provide coverage for the
15
deliberate intent claims of the Russells against Kimes Steel, and the conflicting exclusion
may not be enforced.8
IV.
CONCLUSION
For the reasons stated, we affirm the circuit court’s “Order Denying
Defendant First Mercury Insurance Company’s Motion for Partial Summary Judgment
and Granting Plaintiffs’ Cross-Motion and Defendant Kimes Steel’s Motion for Partial
Summary Judgment on Coverage Issues.”
Affirmed.
8
Because our analysis of the policy language compels us to affirm the circuit
court’s finding of coverage, it is unnecessary for us to address First Mercury’s challenges to
the circuit court’s findings as to Kimes Steel’s reasonable expectations of coverage, illusory
coverage, or estoppel. Additionally, because we have found the subject policy provides
coverage, there necessarily is a duty to defend on the part of First Mercury. See State ex rel.
Nationwide Mut. Ins. Co. v. Wilson, 236 W. Va. 228, 234, 778 S.E.2d 677, 683 (2015) (“[A]n
insurer’s duty to indemnify its insured under a CGL policy is narrower than its duty to
provide a defense.”).
16