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In re Deepwater Horizon

ELR Citation: 43 ELR 20058
Nos. 12-30230, (5th Cir., 03/01/2013)

The Fifth Circuit held that Transocean's primary and excess-liability insurers must cover BP's pollution-related liabilities deriving from April 2010 oil spill in the Gulf of Mexico. Under Texas law, the umbrella insurance policy—not the indemnity provisions of Transocean's and BP's contract—controls the extent to which BP is covered for its operations under the Drilling Contract. Because the umbrella policies between the insurers and Transocean do not impose any relevant limitation upon the extent to which BP is an additional insured, and because the additional insured provision in the Drilling Contract is separate from and additional to the indemnity provisions therein, BP is entitled to coverage under each of Transocean’s policies as an additional insured as a matter of law.