The Third Circuit has affirmed the dismissal of our client, a Texas insurance broker, finding the broker had no personal contacts with the Virgin Islands. The plaintiff was seriously injured in an automobile accident in the Virgin Islands when defendant’s truck hit the plaintiff’s motorcycle. Defendant was a Texas based maintenance contractor who had a subsidiary that did business in the Virgin Islands at the local oil refinery.

Defendant’s insurer denied coverage due to an automobile exclusion. Plaintiff eventually entered into a consent judgment for $5MM and defendant gave plaintiff an assignment of rights against the insurer, agents and brokers. The Plaintiff sued the insurer for wrongfully denying coverage and an insurance broker for breach of contract and negligent procurement. Beckstedt & Kuczynski LLP, together with stateside counsel, defended the insurance broker.

The Third Circuit agreed that the broker, who only ever dealt with the defendant’s Texas insurance agent, did not do business in the Virgin Islands and had no knowledge that the insurance it was brokering was intended to cover the company’s maintenance activities in the Virgin Islands. In addition, the Third Circuit found that the claims against the insurer accrued when coverage was denied, not when the plaintiff obtained the assignment of rights, and as such were barred by the statute of limitations.

Finally, the Third Circuit also found that, alternatively, there was no coverage because of the plain and unambiguous policy language excluding claims for injury arising from automobile accidents.