Coastal Refining & Marketing, Inc., Coastal Offshore Insurance Limited, and Lexington Insurance Company v. United States Fidelity and Guaranty Company
This insurance coverage dispute centers on whether United States Fidelity and Guaranty Company (USF&G) had a duty to reimburse its insured, Coastal Refining & Marketing, Inc., and two other carriers, Coastal Offshore Insurance Limited and Lexington Insurance Company, for costs incurred in settling a personal injury lawsuit. USF&G moved for summary judgment, arguing late notice, settlement without consent, and failure to cooperate by its insured. The appellate court reversed the trial court's summary judgment, finding that USF&G failed to produce evidence of actual prejudice resulting from the insured's actions. The court clarified that for bodily injury and property damage claims, actual, not merely speculative, prejudice must be demonstrated to void coverage. The case was remanded for further proceedings consistent with this opinion.