The United States District Court for the District of Maine has held that coverage for a default judgment was not available under two claims-made insurance policies issued to affiliate companies, because there was no evidence to suggest that a claim was made during the policy period or the extended reporting period.Edwards v. Lexington Ins. Co., 2007 WL 603017 (D. Me. Feb. 23, 2007).
Three affiliate companies were insured under three separate insurance policies issued by the insurer for the period April 8, 2002 to April 8, 2003. One of the insured companies was sued after a safety belt it had manufactured malfunctioned, causing a bow hunter using the belt to fall from a tree on October 11, 2002. The hunter sued the insured for his injuries, and a default judgment was entered after the insurer refused to provide a defense. The hunter sought to enforce the default judgment against the insurer. The court rejected the hunter's argument that, based on the insurer's refusal to defend and the default judgment entered against the policyholder, the court could infer that a claim had been made within the allotted time period, noting that the burden on that issue was on the policyholder, and the hunter failed to provide any evidence in that regard.