Fund for Animals, Inc. v. National Union Fire Insurance

In Maryland, an insurer on a liability insurance policy may disclaim coverage on the ground that the insured breached the policy by giving late notice of a claim “only if the insurer establishes by a preponderance of the evidence that the ... [late] notice has resulted in actual prejudice to the insurer.” Md.Code (1997, 2011 Repl.Vol.), § 19-110 of the Insurance Article (“Ins.”). In this case, we hold that when an insured gives late notice and during the period of delay in notification the insured’s defense becomes impaired, to the actual prejudice of the insurer, the insurer may disclaim…