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Hallmark Specialty seeks coverage ruling after late crash notice
The excess insurer says the settlement demand in the underlying case rose from $1 million to $21 million by the time it received notice.
Hallmark Specialty Insurance Company has filed a declaratory judgment lawsuit seeking a ruling that it has no duty to defend or indemnify its insureds under an excess liability policy tied to a fatal crash. According to the complaint filed July 28, 2026, the underlying dispute stems from a pedestrian struck by a tractor-trailer on February 2, 2023, in a Marathon gas station parking lot in Madison County, Florida. The pedestrian died from injuries in April 2023, and the estate sued in October 2024, later adding an affiliated company that operates the site. Hallmark alleges its policyholders did not report the crash or the lawsuit until June 9, 2026, which it characterizes as 1,223 days after the crash and 613 days after suit was filed. By that point, Hallmark says the case had missed key deadlines, including an April 23, 2025 expert-disclosure deadline, a rebuttal expert disclosure that it says was 384 days late and struck, a denial of summary judgment, and a mediation on May 28, 2026 that ended without settlement. Hallmark also contends the settlement demand increased from $1 million to $21 million before it received notice. The filing says policy terms required the insured to provide written notice “as soon as practicable” after a suit is brought, and it argues that notice roughly two months before trial deprived it of an opportunity to associate in the defense and trial, causing irreparable prejudice. The insurer reserved its rights on July 1, 2026, disclaimed coverage on July 22, 2026, and then brought the action, and the allegations have not yet been tested in court.