The California Supreme Court issued its decision in the State of California v. Continental Insurance case on August 9. In a unanimous opinion, written by Justice Ming Chin, the Court held that the policy language at issue provides for “all sums” allocation and permits stacking of policy limits.
The Court’s opinion reflects a focus on the particular insurance policy wording at issue. In its first holding, the opinion states: “Under the CGL policies here, the plain ‘all sums’ language of the agreement compels the insurers to pay ‘all sums which the insured shall become obligated to pay. . . for damages . . . because of injury to or destruction of property ….” The Court went on to hold that the policy language before it “does not limit the policies’ promise to pay ‘all sums’ of the policyholder’s liability solely to sums or damage ‘during the policy period.’”