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Kodiak construction group sues Evanston and Markel over settlement coverage
The lawsuit, filed Aug. 12 in Alaska federal court, challenges Evanston’s shift from reimbursing defense costs to refusing any payment toward the settlement.
An Alaska federal lawsuit says an insurer covered a Kodiak, Incorporated policyholder’s defense bills, then refused to fund a settlement those lawyers were pursuing, according to Insurance Business.
The complaint, filed Aug. 12, 2026, names Evanston Insurance Company and its claim administrator, Markel Service, Incorporated, and is brought by natives of Kodiak, Incorporated and four affiliated Koman companies. The insureds allege the carriers owe indemnity for a settlement reached in connection with an earlier federal qui tam case.
The coverage dispute traces to what the filing calls the “Underlying Action,” a whistleblower case in Texas that alleges False Claims Act and Anti-Kickback violations, along with retaliation and other employment wrongdoing by the insureds. The complaint notes those allegations are unproven in this separate Texas case, and are not claims being judged in the Alaska coverage matter.
The policy structure described in the complaint includes an Environmental Common Policy with Professional Liability coverage, for the March 1, 2023 to March 1, 2024 period, with a $1,000,000 each-claim limit and $2,000,000 aggregate, plus a For Profit Management Liability Policy with separate D&O and Employment Practices components, each with a $1,000,000 limit, and a Commercial Excess Liability Policy with a $5,000,000 limit. The insureds say a regulatory endorsement rewrites the professional-services exclusion so it does not apply to claims made under the False Claims Act or similar federal or state statutes, and the filing alleges Markel’s Oct. 29, 2024 coverage determination linked the False Claims Act allegations to the D&O part and retaliation to the Employment Practices part. The complaint further alleges that starting in June 2026, after a request to join mediation, the insurer asserted the management liability coverage was eroded, exhausted, and closed, after previously acknowledging coverage for parts of the claim.