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Preview: LexisNexis® Mealey's™ Reinsurance Legal News

LexisNexis® Mealey's™ Reinsurance Legal News



Headline Reinsurance Legal News from LexisNexis®



 



No Support For Breach Of Contract Tied To Payment Of Reinsurance Deductible
NEW YORK - In support of a breach of contract claim in an insurance coverage dispute over flood damage at a construction site, construction companies failed to show that their insurer's settlement caused them to pay a $50,000 deductible under a captive reinsurance agreement, a New York federal judge ruled May 4, dismissing the complaint (Keller Foundations LLC, et al. v. Zurich American Insurance Co., No. 16-6751, S.D. N.Y., 2017 U.S. Dist. LEXIS 68902).



Judge Bars Testimony In Reinsurance Risk Company's Breach Of Contract Case
SAN FRANCISCO - A California federal judge excluded on May 10 lay opinion testimony by a reinsurance risk management company's chief financial officer in a breach of contract lawsuit about funds that were improperly withdrawn from bank accounts (Les Fields/C.C.H.I. Insurance Services v. Stuart M. Hines, et al., No. 15-03728, N.D. Calif., 2017 U.S. Dist. LEXIS 71620).



Insurers' Rehabilitator Fails To Allege Breach Of Contract Claim, Reinsurer Asserts
CHICAGO - A mortgage insurance reinsurer argues in a May 5 reply brief to an Illinois federal court that the rehabilitator of two insolvent insurers failed to assert sufficient allegations to support breach of contract and breach of the implied covenant of good faith and fair dealing claims (People of the State of Illinois, ex rel., Anne Melissa Dowling, Acting Director of Insurance of the State of Illinois, as Rehabilitator for Triad Guaranty Insurance Corporation and Triad Guaranty Assurance Corp. v. AAMBG Reinsurance Inc., No. 16-cv-07477, N.D. Ill.).



Judge: Cession Statement Is Not Necessary To Establish Reinsurance Agreement
PHILADELPHIA - An insurer adequately alleged a relationship between an insurance policy and a reinsurance contract, even without reference to a cession statement, a Pennsylvania federal judge ruled May 12, denying the reinsurer's motion for judgment on the pleadings on the insurer's breach of contract counterclaim (R&Q Reinsurance Co. v. St. Paul Fire & Marine Insurance Co., No. 16-cv-01473, E.D. Pa., 2017 U.S. Dist. LEXIS 72964).



Reinsurers Counterclaim For Breach Of Contract, Argue Insureds Owe Past Premiums
NEW YORK - Accused by insureds of a fraudulent workers' compensation scheme involving a reinsurance participation agreement, reinsurers assert their own breach of contract counterclaim in a May 4 answer to a New York federal court, alleging that the insureds failed to pay $2.7 million in premiums (National Convention Services, LLC, et al. v. Applied Underwriters Captive Risk Assurance Company, Inc., et al., No. 15-cv-07063, S.D. N.Y.).



Life Insurer Obtains $2.7M Default Judgment Against Reinsurer Over Medical Claims
CHICAGO - Finding that a reinsurer abandoned its defense and any claims against a life insurance company, an Illinois federal judge on April 11 entered a $2,716,527.64 default judgment to the insurer against the reinsurer in a dispute over medical reinsurance proceeds (Guarantee Trust Life Insurance Co. v. American Medical and Life Insurance Co., No. 10-cv-02125, N.D. Ill.).



Syndicates Seek Arbitration Of Role In Claims Dispute Affecting Reinsurance Billings
BOSTON - A collection of insurance syndicates sued an insurer on April 11 in Massachusetts federal court, seeking to compel arbitration with regard to their involvement in an underlying coverage dispute over environmental claims that would affect reinsurance billings (Certain Underwriters at Lloyd's, London v. Transport Insurance Co., No. 17-10618, D. Mass.).



Court Was Not Required To Confirm Arbitration Award, Reinsurer Asserts
NEW HAVEN, Conn. - A reinsurer argues in its April 28 reply brief that a Connecticut federal court should grant reconsideration of an order confirming an arbitration award because the court was not required to enter judgment in sum certain (General Re Life Corp. v. The Lincoln National Life Insurance Co., No. 15-cv-01860, D. Conn.).



Judge Sets Oral Argument For Dispute On Sending Reinsurance Lawsuit To Arbitration Panel
NEW YORK - A New York federal judge on May 9 scheduled oral argument on whether a dispute regarding reinsurance of workers' compensation risks should be sent to arbitration for a panel to decide (In the Matter of the Arbitration Between National Union Fire Insurance Company of Pittsburgh, PA v. Federal Insurance Co., No. 16-cv-08821, S.D. N.Y.).



Reinsurer Seeks Discovery On Post-Complaint Documents Relating To Coverage Issues
SYRACUSE, N.Y. - In an asbestos coverage dispute, a reinsurer on May 15 asked a New York federal court to reconsider a discovery ruling and to compel an insurer to produce all post-complaint, internal documents involving coverage issues relating to primary and umbrella policies (Utica Mutual Insurance Co. v. R&Q Reinsurance Co., No. 15-cv-270, N.D. N.Y.).



Insurer Compels Discovery In Dispute Over Fraudulent Reinsurance Transfers
ATLANTA - In a case over fraudulent transfers of reinsurance funds, insurers on May 1 moved for a Georgia federal court to compel individuals to provide documents pertaining to a reinsurer after having failed to previously satisfy a discovery order (Canal Insurance Co. and Canal Indemnity Co. v. Golden Isles Reinsurance Company Ltd, et al., No. 15-cv-03331, N.D. Ga.).



Homeowners Allege Captive Scheme By Banks, Reinsurer In First Amended Complaint
PHILADELPHIA - Homeowners filed a first amended class action complaint on April 26 in a Pennsylvania federal court, alleging a captive reinsurance scheme between banks and an affiliated reinsurer in violation of the Real Estate Settlement Procedures Act (RESPA) (Christopher Blake and James Orkis v. JPMorgan Chase Bank, N.A., et al., No. 13-6433, E.D. Pa.).



Insurer's Liquidator Seeks Additional $362,788 Claim Against Reinsurer
NEW YORK - In a dispute over reinsurance proceeds allegedly owed to the estate of The Home Insurance Co., the liquidator on May 11 requested a pre-motion conference in a New York federal court to address an amendment to his complaint against a reinsurer to assert an additional claim of $362,787.84 (Roger A. Sevigny, the Commissioner of Insurance of the State of New Hampshire, as Liquidator of The Home Insurance Company v. Trygvesta Forsikring A/S, as successor in interest to Skandinavia Insurance Company Ltd., Trygvesta Forsikring A/S v. Cerberus Holding Company, LLC., No. 16-cv-04874, S.D. N.Y.).



3rd Circuit Dismisses Appeal Of Mortgage Insurance Reinsurance Kickbacks Case
PHILADELPHIA - The Third Circuit U.S. Court of Appeals on May 8 dismissed an appeal of a group of mortgage borrowers challenging a lower court ruling that their mortgage insurance reinsurance kickback claims were time-barred (William Weiss, et al. v. Bank of America Corp., et al., No. 16-4386, 3rd Cir.).



Reinsurer, Insurer Breach Of Contract Dispute Stayed Pending Potential Settlement
NEW HAVEN, Conn. - A Connecticut federal judge on May 4 stayed a breach of contract dispute between a reinsurer and insurer so that the parties could pursue a settlement agreement (Travelers Casualty and Surety Co., f/k/a The Aetna Casualty and Surety Co. v. Century Indemnity Co. as successor to Insurance Company of North America, No. 16-cv-170, D. Conn.).



8th Circuit Upholds Federal RICO Claims Dismissal Against Insurer, Reinsurer
ST. LOUIS - Allowing federal racketeering claims against an insurer and its affiliates, including a reinsurer, to proceed would impair state regulation of the insurance business in Iowa, Maryland or Missouri, the Eighth Circuit U.S. Court of Appeals affirmed April 13 (Dale R. Ludwick, on behalf of herself and all others similarly situated v. Harbinger Group Inc., et al., No. 16-1561, 8th Cir., 2017 U.S. App. LEXIS 6391).



Judge Declines To Seal Docs In Reinsurer, Insurer Dispute Over Asbestos Coverage
SYRACUSE, N.Y. - Supporting documents pertaining to transcripts, arbitration filings and expert reports will not be sealed in a breach of contract dispute between an insurer and reinsurer over asbestos coverage, a New York federal judge ruled April 26 (Utica Mutual Insurance Co. v. Munich Reinsurance America Inc., No. 12-cv-00196, Munich Reinsurance America Inc. v. Utica Mutual Insurance Co., No. 13-cv-00743, N.D. N.Y.).



Insurer To N.Y. High Court: Asbestos Defense Costs Are Not Held To Reinsurer's Cap
NEW YORK - A reinsurer must cover an insurer's costs to defend an insured in asbestos litigation beyond its total liability cap because a prior New York decision does not compel a conclusion that the cap includes both indemnity and defense costs, the insurer argues in an April 14 appellant brief regarding a certified question to the New York Court of Appeals (Global Reinsurance Corporation of America, successor in interest Constitution Reinsurance Corp. v. Century Indemnity Co., successor interest to CCI Insurance Co., successor interest to Insurance Company of North America, No. CTQ-2016, 0005, N.Y. App.).



Judge Waits To Address Motion To Strike Affidavit In Case Against Reinsurer
NEW HAVEN, Conn. - Declining to strike an affidavit from a senior vice president of a reinsurer because it is inappropriate to address the motion at the summary judgment stage, a Connecticut federal judge said April 25 that she would address the arguments in her ruling on the motion for summary judgment in a breach of contract dispute between a reinsurer and insurer (Travelers Casualty and Surety Co., f/k/a The Aetna Casualty and Surety Co. v. Century Indemnity Co. as successor to Insurance Company of North America, No. 16-cv-170, D. Conn.).



Judge: Captive Reinsurance Scheme Is A Continuing Violation Of Real Estate Act
PHILADELPHIA - An alleged captive reinsurance scheme between banks and an insurer constitutes a continuing violation of the Real Estate Settlement Procedures Act (RESPA), each time an "illegal kickback, fee, or referral was given or received," a Pennsylvania federal judge ruled April 26, finding that the statute of limitations ran from the date of the last violation rather than the first based upon the continuing violations doctrine (Christopher Blake and James Orkis v. JPMorgan Chase Bank, N.A., et al., No. 13-6433, E.D. Pa., 2017 U.S. Dist. LEXIS 64392).



Reinsurer Properly Interpreted Special Provisions To Deny Claims, Magistrate Judge Says
ST. LOUIS - The Federal Crop Insurance Corp. (FCIC), as reinsurer, has the duty and authority to issue a binding interpretation of special provisions, a Missouri federal judge ruled March 24, finding that the reinsurer correctly confirmed denial of coverage to four farming entities for their damaged rice crops (Bottoms Farm Partnership, et al. v. U.S. Department of Agriculture, et al., No. 15-CV-1073, E.D. Mo., 2017 U.S. Dist. LEXIS 43113).



Judge Addresses Discovery On Documents Related To Reinsurance Agreement
LINCOLN, Neb. - A Nebraska federal judge on March 31 granted and denied in part a motion to compel information and documents concerning a reinsurance agreement and the relationship between a note and the reinsurance agreement (Applied Underwriters Inc. v. Top's Personnel Inc., No. 15CV90, D. Neb., 2017 U.S. Dist. LEXIS 49135).



Federal Magistrate Compels Insurer To Provide Notices With Co-Insurers, Reinsurers
CHICAGO - An insurer is compelled to provide notices with its co-insurers and reinsurers under a 1990 insurance policy, an Illinois federal judge ruled March 30, because the notices might reveal admissions from the insurer about the availability of coverage toward the settlement of lawsuits over the use of contaminated blood products (Baxter International Inc. v. AXA Versicherung, No. 11-cv-09131, N.D. Ill., 2017 U.S. Dist. LEXIS 48607).



Insurer Says It Has Complied With Reinsurer's Request For Docs About Asbestos Coverage
SYRACUSE, N.Y. - In response to a reinsurer's request for documents concerning primary and umbrella policies at issue in asbestos coverage dispute, an insurer argues to a New York federal court in an April 7 brief that it has provided admissions, denials, responses and objections regarding the documents (Utica Mutual Insurance Co. v. R&Q Reinsurance Co., No. 15-cv-270, N.D. N.Y.).



Reinsurer Denies Amended Breach Of Contract Claims In Suit Filed By Reinsured
MONTGOMERY, Ala. - A reinsured submitted a reinsurance loss bill under a different agreement than the one listed in the reinsured's amended complaint, a reinsurer told an Alabama federal court on May 2, asserting affirmative defenses of estoppel and waiver (Alabama Municipal Insurance Corp. v. Munich Reinsurance America Inc., No. 16-cv-00948, M.D. Ala.).



Reinsurer Says Policy Wasn't Reinsured, Seeks Dismissal Of Breach Of Contract Claim
PHILADELPHIA - Because an insurer never linked an underlying policy to a facultative certificate, a reinsurer argues in its April 11 reply brief to a Pennsylvania federal court that the insurer's breach of contract counterclaim should be dismissed as there is no contract between the parties reinsuring that policy (R&Q Reinsurance Co. v. St. Paul Fire & Marine Insurance Co., No. 16-cv-01473, E.D. Pa.).



Rehabilitator: Allegations Support Breach Of Contract Claims Against Reinsurer
CHICAGO - The rehabilitator of two insolvent insurers argues in an April 21 brief in an Illinois federal court that there are sufficient allegations to support breach of contract and breach of the implied covenant of good faith and fair dealing claims against a mortgage insurance reinsurer (People of the State of Illinois, ex rel., Anne Melissa Dowling, Acting Director of Insurance of the State of Illinois, as Rehabilitator for Triad Guaranty Insurance Corporation and Triad Guaranty Assurance Corp. v. AAMBG Reinsurance Inc., No. 16-cv-07477, N.D. Ill.).



Justice Sends Lawsuit Against Reinsurance Investment Co.'s Former Officers To Arbitration
NEW YORK - Finding arbitration provisions in employment and separation agreements valid, a New York justice on April 14 ordered a reinsurance investment company's fraud and breach of fiduciary duty lawsuit against its former officers to arbitration (Southport Lane Management LLC and Southport Lane L.P. v. Kevin Adler and Brian Lessig, No. 155915/2016, N.Y. Sup., New York Co., 2017 N.Y. Misc. LEXIS 1348).



Insurer Ends $1.1 M Reinsurance Lawsuit Against Excalibur Re
NEW HAVEN, Conn. - Select Insurance Co. on April 12 voluntarily dismissed its Connecticut federal court case demanding $1.1 million in retrocessional proceeds from Excalibur Reinsurance Corp. for an underlying settlement of claims filed against Ernst & Young (Select Insurance Co. v. Excalibur Reinsurance Corp., f/k/a PMA Capital Insurance Co., No. 15-cv-00715, D. Conn.).



Panel Upholds Denial Of Arbitration For Insolvent Insurer's Reinsurance Contract
CHICAGO - A trial judge properly invoked collateral estoppel to deny a motion to compel arbitration filed by an assigned entity to an insolvent insurer's reinsurance contract, an Illinois appeals panel ruled March 31 (Pine Top Receivables of Illinois LLC v. Transfercom Ltd., No. 1-16-1781, Ill. App., 6th Div., 2017 Ill. App. LEXIS 196).



Judge: Court Holds Rule Over Nonresidents In Reinsurance Case
ATLANTA - A federal judge in Georgia on April 13 denied a motion to dismiss claims regarding alleged fraudulent transfers of reinsurance funds for lack of jurisdiction, holding that the court does hold jurisdiction over a group of people that do not live in Georgia (Canal Insurance Company, et al. v. Golden Isles Reinsurance Company, Ltd, et al., No. 15-cv-3331, N.D. Ga.).



Clerk Notifies Parties That Inaction May Cause Dismissal Of Reinsurance Case
NEW HAVEN, Conn. - The clerk of a federal court in Connecticut on April 3 notified an insurer and an insolvent reinsurer that they must explain their inaction regarding a suit or the suit will be dismissed (Select Insurance Company v. Excalibur Reinsurance Corporation, f/k/a PMA Capital Insurance Company, No. 15-cv-00715, D. Conn.).



Judge Refuses To Quash Bank's Subpoena Over Financial Documents
COLUMBIA, S.C. - Finding that not all documents are privileged under the South Carolina Holding Company Regulatory Act, a South Carolina federal judge on April 10 declined to quash a subpoena in which a bank accused of mishandling reinsurance funds seeks an insurer's financial documents from state insurance regulators (Companion Property and Casualty Insurance Co. n/k/a Sussex Insurance Co. v. U.S. Bank National Association v. Redwood Reinsurance Spc. Ltd., et al., No. 15-01300, D. S.C., 2017 U.S. Dist. LEXIS 54182).



Reinsured Says Documents Sought By Reinsurer Have Nothing To Do With Case
BOSTON - An insurer told a federal court in Massachusetts on April 10 that the records sought by its reinsurer are irrelevant to the instant case and that by seeking these documents, the reinsurer is ignoring the tenants of the follow-the-settlements doctrine (Lamorak Insurance Company v. Everest Reinsurance Co., No. 15-cv-13425, D. Mass.).



Reinsurer Says Declaration Does Not Contradict Prior Testimony
NEW HAVEN, Conn. - A reinsurer told a federal court in Connecticut on April 10 that a declaration of one of its executives in support of a motion for summary judgment should not be stricken because it is not in contradiction of earlier testimony (Travelers Casualty and Surety Company, f/k/a The Aetna Casualty and Surety Company v. Century Indemnity Company as successor to Insurance Company of North America, No. 16-cv-00170, D. Conn.).



Insurer Says It Is Challenging Decision That Favors Its Reinsurer
NEW YORK - An insurer told a federal court in New York on April 19 that it is appealing the court's decision that vacated a reinsurance arbitration award because of the actions of an arbitrator (Certain Underwriting Members at Lloyd's, London v. Insurance Company of the Americas, No. 16-cv-00323, S.D. N.Y.).



Reinsured Says Court Correctly Confirmed Reinsurance Arbitration Award
NEW HAVEN, Conn. - An insurer told a federal court in Connecticut on April 18 that a motion for reconsideration of the confirmation of an arbitration award should not be granted because there was no manifest injustice in the confirmation decision (General Re Life Corporation v. The Lincoln National Life Insurance Company, No. 15-cv-01860, D. Conn.).



Reinsurer: Cession Statement Essential To Consummation Of Reinsurance Agreement
PHILADELPHIA - A reinsurer told a federal court in Pennsylvania on April 11 that its reinsured is incorrect in its assertions regarding a cession statement, which the reinsurer says is an essential element of the parties' reinsurance agreement (R&Q Reinsurance Company v. St. Paul Fire & Marine Insurance Company, No. 16-cv-01473, E.D. Pa.).



Insurer Says Its Payment Of Asbestos Claims Was Reasonable
SYRACUSE, N.Y. - An insurer told a federal court in New York on April 7 that its payments to its insured were reasonable and that a reinsurer's challenge to those payments is contrary to the follow-the-fortunes doctrine (Utica Mutual Insurance Company v. Century Indemnity Company, No. 13-cv-00995, N.D. N.Y.).



Reinsurer Claims Reinsured Improperly Submitted New Evidence In Reply
NEW HAVEN, Conn. - A reinsurer told a federal court in Connecticut on April 10 that its reinsured should not be allowed to introduced new evidence in its summary judgment reply brief in a dispute over whether the reinsurer is obligated to honor the reinsured's settlement (Travelers Casualty and Surety Company, f/k/a The Aetna Casualty and Surety Company v. Century Indemnity Company as successor to Insurance Company of North America, No. 16-cv-00170, D. Conn.).



Mortgage Insurance Reinsurer Says It Did Not Violate RESPA
CHICAGO - A mortgage insurance reinsurer told a federal court in Illinois on April 5 that it is not the party responsible for disclosing information to mortgagees as required by the Real Estate Settlement Procedures Act (RESPA) (People of the State of Illinois, ex rel., Acting Director of Insurance, Anne Melissa Dowling v. HMC Reinsurance Company, a Vermont Corporation, No. 16-cv-08156, N.D. Ill.).



Receiver Says Insolvent Insurer Owes London-Based Reinsurers For 2013 Premium
LAS VEGAS - The receiver of an insolvent insurer reported to a Nevada court on Feb. 15 that the receivership estate does not have enough assets to fully pay claims against the estate and owes money to certain London-based reinsurers (State of Nevada, ex rel. Commissioner of Insurance, in His Official Capacity as Statutory Receiver for Delinquent Domestic Insurer v. Professional Aviation Insurance Reciprocal, a Nevada Domiciled Reciprocal Captive Insurance Company, No. A-700829-p, Nev. Cir., Clark Co.).