The federal district court for the District of New Jersey ruled that an insurer providing coverage for a shared-risk group is not obligated to pay the policy limits for each insured in the group. The case is Colony Ins. Co. v. Aspen Specialty Ins. Co., 564 F. Supp. 3d 343 (D.N.J. 2021).

Three insurers—Colony, Aspen, and American Guarantee and Liability Insurance Company (AGLIC)—all issued policies to the administrator of a shared-risk program to provide coverage for more than 200 insureds in the shared-risk group. Aspen provided primary coverage through a CGL policy that included a liquor liability endorsement. Colony's policy was excess coverage for Aspen, and AGLIC provided excess coverage for both Aspen and Colony. 

Aspen mounted a defense for DBD, an insured in the shared-risk group who had been sued for liquor liability. Aspen's liability endorsement had a $1 million limit "for all damages because of all 'bodily injury' and 'property damage' included within the 'liquor hazard' … sustained by one or more persons or organizations" who were part of the shared-risk program. (emphasis added). Aspen had already paid liquor liability claims for other insureds in the shared-risk group during the policy period, so the full amount of coverage was not available to other insureds in the group.