Policyholder Liable For Insolvent Carriers’ Long-Tail Claims, N.J. Appellate Court Rules

TRENTON, N.J. — A December 2004 amendment to the New Jersey Property-Liability Insurance Guaranty Association Act only applies prospectively, a New Jersey appellate court has ruled, concluding that insureds are therefore liable for the allocation of long-tail claims to insurers that became insolvent prior to the enactment of the amendment.

In a Jan. 12 opinion, the New Jersey Superior Court, Appellate Division, said the Act clearly states that the amendment only applies prospectively.

Beginning in 1970, Ward Sand and Materials Co. accepted Pennsauken Township's municipal waste at Ward's sand mining property. In 1978, Ward sold the property to the Township. …