In an insurance coverage action regarding an insurer’s duty to defend or indemnify defendant property owners in an underlying personal injury suit, the New York County Supreme Court determined that the suit was excluded from coverage and entered default judgment in favor of the insurer. Defendants, although properly served by the insurer, failed to enter appearances, so the insurer brought a motion pursuant to CPLR 3215 for default judgment and presented competent evidence that it had no duty under the facts of the case and language of the policy to defend or indemnify the defendants because the property where the accident occurred was not an “insured location.”

The personal injury occurred when the claimant in the underlying suit fell on a sidewalk directly in front of property owned by the insured. The insurer argued that the Personal Liability Coverage Exclusion in the policy eliminated coverage for bodily injury “[a]rising out of a premises owned by an ‘insured’ … that is not an ‘insured location.’” The policy contained several definitions of the types of premises qualifying as an “insured location,” including property that is the “residence premises.”

The court looked to the policy language to determine whether the property qualified as a “residence premises.” In this case, where the property described in the policy declarations was a separate dwelling, the policy stated that such property was only a “residence premises” if it was a one-family or two-family dwelling. The insurer presented evidence that the property was neither a one-family nor a two-family dwelling; rather it was a three-family dwelling consisting of three units that each had separate entrances and their own bedrooms, kitchens and bathrooms.

Accordingly, the court determined that the property was not a “residence premises” within the meaning of the policy, and since it was not a “residence premises,” it could not be an “insured location.” The court then examined the language of the underlying suit and determined that it sought damages for bodily injury “[a]rising out of a premises owned by an ‘insured’ … that is not an ‘insured location.’” Based on the language of the Personal Liability Coverage Exclusion in the policy, the court held that it clearly excluded liability coverage for the underlying action.

Finding that the insurer had sufficient evidence for default-judgment purposes that the underlying suit was excluded from coverage, the court held that the insurer had no duty to defend or indemnify the defendants.

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