Starr Surplus Lines says United Fire agreed to cover a contractor, then paid nothing - leaving it to foot the defense bill and the settlement.
Starr Surplus Lines Insurance Company has sued United Fire and Casualty Company in federal court, claiming United Fire failed to pay a defense bill and a settlement that Starr says United Fire should have covered - and left Starr to pay both.
The complaint, filed September 2, 2026 in the US District Court for the Western District of Missouri, is a carrier-versus-carrier fight over who owed what to a shared policyholder: a restoration contractor.
According to the complaint, a condominium association hired the contractor in April 2015 to fix water leaks in the outdoor terraces and parking garages of a condo property. The contractor handed the waterproofing and sealant work to a subcontractor, which, the filing says, agreed in writing to name the contractor as an additional insured on its policies.
That subcontractor's insurer was United Fire. According to the complaint, its primary commercial general liability policies ran from March 6, 2015 to March 6, 2023, with a $1 million each-occurrence limit and a $2 million general aggregate. The umbrella coverage reached $5 million per occurrence in the earlier policy years.
The case turns on the additional-insured wording. Under the United Fire policies, coverage extends to “Any person or organization for whom you are performing operations when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy.” Starr says that language brings the contractor under United Fire's coverage.
The work later became the subject of a lawsuit. According to the complaint, the condominium association sued the contractor in December 2021 over alleged construction defects, claiming the waterproofing had failed and let water into the project. The contractor, in turn, pointed to its subcontractor, alleging in a third-party filing that the subcontractor had substituted a waterproofing compound called Hydralastic 836 that later failed on the terraces and balconies.
The complaint says the contractor asked the subcontractor and United Fire to defend it again and again, starting in February 2022 and continuing into early 2025, with no response. Only in April 2025, after the contractor tendered the claim directly to United Fire, did the insurer reply. On April 19, 2025, the filing says, United Fire sent a letter agreeing to cover the contractor as an additional insured under several of the subcontractor's policies.
The agreement, Starr says, never turned into payment. According to the complaint, United Fire never defended the contractor, never took over its defense, and never reimbursed the contractor or Starr for defense costs already incurred. Starr, which had issued its own policies to the contractor, says it stepped in, paid the defense costs, and later covered the contractor's share of the settlement that ended the underlying case.
Starr's coverage, though, was meant to sit on top of United Fire's - not underneath it. Its policies say the insurance is “excess over ... Any other primary insurance available to you covering liability for damages arising out of the premises or operations, or the products and completed operations, for which you have been added as an additional insured.” In plain terms, Starr's position is that United Fire had to pay first, and Starr only after United Fire's coverage was used up. United Fire, the complaint says, “contributed nothing” toward what Starr paid.
Starr is pressing four claims - for declaratory judgment, equitable subrogation, equitable contribution and unjust enrichment - all aimed at recovering the money it paid. It wants the court to declare that United Fire was obligated to defend the contractor and to cover its share of the settlement, and to order United Fire to pay Starr back. The complaint puts the damages “in excess of $75,000.00,” with the exact figure to be set at trial; the settlement itself was resolved on confidential terms.
For claims and coverage teams, the fight comes down to two familiar questions: when additional-insured status is triggered, and which insurer pays first when two policies overlap.
The allegations have not been tested in court, and no judge has ruled on the claims.
