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Insurers Should Avoid Suing Each Other\\n\\nThe United StatesCourt of Appeals for the Ninth Circuit certified to the\\n California Supreme Court, the following question for our review: "Under\\n California\'s Motor Carriers of Property Permit Act (Veh. Code, \\xa7 34600 \\net seq.; the Act), does a commercial automobile insurance policy \\ncontinue in full \\nforce and effect until the insurer cancels the corresponding Certificate\\n of Insurance on file with the Department of Motor Vehicles (DMV or \\nDepartment), regardless of the insurance policy\'s stated expiration \\ndate?"\\n\\nThe Supreme Court in Allied Premier Insurance v. United Financial \\nCasualty Company, S267746, Supreme Court of California (July 24, 2023) \\nthe California Supreme Court logically advised the court of its opinion \\nbased on the statute and California precedent.\\n\\nThe certified question arose only in the context of claims for equitable\\n contribution and subrogation between two insurance companies. It bears \\nrepeating that the plaintiffs in the underlying lawsuit were compensated\\n to the full limits of Allied\'s policy under the terms of their \\nsettlement and that, at all relevant times, Porras, the trucker, \\nproperly maintained an active operating permit.\\n\\nBACKGROUND\\n\\nA carrier can satisfy that requirement by obtaining a policy of \\ninsurance. If a carrier does so, the insurer must submit a certificate \\nof insurance to the Department as evidence that the "protection required\\n under [section 34631.5,] subdivision (a)" is provided.\\n\\nThe Act requires that proof of financial responsibility be continued in \\neffect during the active life of the permit issued to the motor carrier.\\n This requirement prohibits cancellation of a certificate of insurance \\nwithout notice to the DMV by the insurer. \\n\\nUnited appealed to the Ninth Circuit, which certified the question of \\nlaw to the Supreme Court. If the Act requires a commercial auto \\ninsurance policy to remain in effect indefinitely until the insurer \\ncancels the certificate of insurance on file with the DMV, then Allied \\nmust prevail. If not, United must prevail.\\n\\nDISCUSSION\\n\\nEquitable contribution assumes the existence of two or more valid \\ncontracts of insurance covering the particular risk of loss and the \\nparticular casualty in question. \\n\\nThe Act Does Not Extend the Policy Beyond the Term Contained in the \\nContract\\n\\nAs to cancellation of a policy, the HCA provided that protection against\\n liability shall be continued in effect during the active life of the \\ntrucker\'s permit, and that the policy of insurance or surety bond shall \\nnot be cancelable on less than 30 days\' written notice to the PUC, \\nexcept in the event of cessation of operations as a highway carrier as \\napproved by the PUC.\\n\\nAn uncancelled certificate of insurance that remains on file with the \\nDMV does not cause the corresponding insurance policy to remain in \\neffect in perpetuity. But that is not to say that an uncancelled \\ncertificate of insurance imposes no obligation of any kind on the \\nresponsible insurer.\\n\\nCONCLUSION\\n\\nUnder the Act, a commercial automobile insurance policy does not \\ncontinue in full force and effect until the insurer cancels a \\ncorresponding certificate of insurance on file with the DMV. The \\nduration of the policy\'s coverage is regulated by its terms and those of\\n any endorsement or amendment to the policy itself. The terms of an \\ninsurance contract generally determine the duration of the policy\'s \\ncoverage.\\n\\nAlthough an endorsement can amend the policy, neither the Act nor the \\nspecific endorsement requires extending coverage beyond the underlying \\npolicy\'s expiration date.