Preview: LexisNexis® Mealey's™ Reinsurance Legal News
LexisNexis® Mealey's™ Reinsurance Legal News
Headline Reinsurance Legal News from LexisNexis®
Judge Orders European Reinsurer To Proceed With Arbitration Of Dispute
NEW YORK - A federal judge in New York on Feb. 7 granted an insurer's motion to stay a $5.4 million reinsurance dispute and compel a European reinsurer to the arbitration table, holding that the reinsurer cannot avoid an arbitration clause in a reinsurance agreement by arguing that the reinsurance agreement is void (HDI Global SE v. Lexington Insurance Company, No. 16-cv-07241, S.D. N.Y.).
Judge Assures Confidentiality Of Material In Asbestos- Related Reinsurance Case
PHILADELPHIA - A federal judge in Pennsylvania in a reinsurance dispute over asbestos-related claims granted on Feb. 2 an insurer's unopposed motion for the issuance of a protective order regarding confidential information (R&Q Reinsurance Company v. St. Paul Fire & Marine Insurance Company, No. 16-cv-01473, E.D. Pa.).
Judge Denies Objection, Says Magistrate Judge's Discovery Order Was Proper
SALT LAKE CITY - A federal judge in Utah on Feb. 13 denied an insolvent insurer's objection to a magistrate judge's order compelling discovery of certain categories of information sought by a group of the insolvent insurer's former directors and officers (Western Insurance Company v. Dick L. Rottman, et al., No. 13-cv-00436, D. Utah, 2017 U.S. Dist. LEXIS 20709).
Justice Approves Reinsurance Commutation Agreement For Insolvent Insurer
CONCORD, N.H. - A New Hampshire justice on Feb. 10 approved an insolvent insurer's reinsurance commutation agreement, which involves the insolvent insurer as both reinsurer and reinsured (In the Matter of the Liquidation of The Home Insurance Company, No. 03-E-0106, N.H. Sup., Merrimack Co.).
Liquidator Asks Court To Approve Direct Payments From Reinsurer To Insured
HARRISBURG, Pa. - The liquidator of an insolvent insurer asked a Pennsylvania court on Feb. 3 to approve a cut-through arrangement by which a reinsurer will make direct payments to an insured, leaving the liquidation estate out of the transactions (In re: Reliance Insurance Company in Liquidation, No. 1 REL 2001, Pa. Cmwlth.).
Circuit Court Dockets Appeal Of Mortgage Insurance Reinsurance Kickbacks Case
PHILADELPHIA - The Third Circuit U.S. Court of Appeals on Dec. 22 docketed the 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 Corporation, et al., No. 16-4368, 3rd Cir.).
Reinsurer Says It Was Not Obligated To Follow The Fortunes Of Its Reinsured
NEW YORK - A reinsurer told the Second Circuit U.S. Court of Appeals on Feb. 1 that a lower court judge erred in finding that the reinsurer was obligated to pay its reinsured under the follow-the-fortunes or follow-the-settlement doctrine (Utica Mutual Insurance Company v. Clearwater Insurance Company, No. 16-cv-2824 and Utica Mutual Insurance Company v. Clearwater Insurance Company, No. 16-2535, 2nd Cir.).
Insurer, Reinsurer Agree To End Reinsurance Breach Of Contract Case
SYRACUSE, N.Y. - An insurer and its reinsurer told a federal court in Massachusetts on Jan. 4 that they are ending their reinsurance billing dispute and breach of contract case (OneBeacon America Insurance Company v. Transatlantic Reinsurance Company, No. 14-cv-14067, D. Mass.).
Reinsured Wants Summary Judgment Against Reinsurer In Breach Of Contract Case
NEW HAVEN, Conn. - A reinsured insurer told a federal court in Connecticut on Jan. 23 that there are no genuine issues of material fact that should stop the court from issuing a summary judgment order regarding the insurer's breach of contract and other claims against its reinsurer (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.).
Assignee Asks 7th Circuit To Reverse Lower Court Finding Regarding Timeliness
CHICAGO - The assignee of certain reinsurance receivables rights challenging a lower court's finding that its claims against a reinsurer are untimely told the Seventh Circuit U.S. Court of Appeals on Jan. 31 that the lower court erred, among other reasons, because it issued a summary judgment on allegedly disputed issues of material fact (Pine Top Receivables of Illinois, LLC v. Banco De Seguros Del Estado, No. 16-3499, 7th Cir.).
2nd Circuit: No Error In Finding Umpire Showed No Evident Partiality
NEW YORK - A Second Circuit U.S. Court of Appeals panel on Jan. 31 affirmed a lower court's confirmation of a number of international arbitration awards, finding that the arbitration umpire did not exhibit evident partiality to a retrocessional reinsurer (National Indemnity Company v. IRB Brasil Resseguros S.A., No. 16-1267, 2nd Cir., 2017 U.S. App. LEXIS 1686).
Judge Confirms International Reinsurance Arbitration Award
NEW YORK - A federal judge in New York on Jan. 24 confirmed an award issued by an arbitration panel in an arbitration between an American insurer and certain London-based reinsurers (OneBeacon Insurance Company v. Certain Underwriters at Lloyd's London, No. 16-cv-09908, S.D. N.Y.).
Magistrate Judge: Reinsurance Is Discoverable In Directors And Officers Suit
SALT LAKE CITY - A federal judge in Utah on Dec. 29 ordered that reinsurance information regarding an insolvent insurer is relevant to the defense of certain directors and officers of the insurer being sued for negligence by the insurer's liquidator (Western Insurance Company v. Dick L. Rottman, et al., No. 13-cv-00436, D. Utah, 2016 U.S. Dist. LEXIS 180161).
Judge Approves Stipulation That Reinsurer Post Bond
NEW YORK - A federal judge in New York on Jan. 30 approved a stipulation and ordered a reinsurer sued by the liquidator of an insolvent insurer for breach of contract to post a security bond with the court (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., No. 16-cv-04874, S.D. N.Y.).
Circuit Judge Grants Motion To File Appeal Brief Under Seal
NEW YORK - A judge of the Second Circuit U.S. Court of Appeals on Jan. 20 granted a reinsurer's motion to file its answering brief under seal, with a redacted version coming in the near future, in a case regarding the alleged breach of a reinsurance agreement (Utica Mutual Insurance Company v. Clearwater Insurance Company, No. 16-cv-2824 and Utica Mutual Insurance Company v. Clearwater Insurance Company No. 16-2535, 2nd Cir.).
Insurer Asks Court To Seal In-House Counsel Communications
SYRACUSE, N.Y. - An insurer asked a federal court in New York on Jan. 26 to keep certain documents sealed, including communications about an insured's asbestos claims between its employees and its in-house counsel (Utica Mutual Insurance Company v. Munich Reinsurance America, Inc., No. 12-cv-00196, and Munich Reinsurance America, Inc. v. Utica Mutual Insurance Company, No. 13-cv-00743, N.D. N.Y.).
Reinsurer: Evidence Of Decades-Old Reinsurance Billings Are Not Available
CHICAGO - A reinsurer in a Jan. 17 brief tells the Seventh Circuit U.S. Court of Appeals that the statutes of limitations of claims brought by the assignee of certain reinsurance receivables rights has passed and that any evidence of the reinsurance billings in question would be decades old and no longer retained by the reinsurer (Pine Top Receivables of Illinois, LLC v. Banco De Seguros Del Estado, No. 16-3499, 7th Cir.).
Farm Says It Should Have Been Given Information Regarding Criminal Investigation
NEW YORK - An agricultural business has told the Ninth Circuit U.S. Court of Appeals that information allegedly withheld by its federal crop insurer should have been divulged before the farm signed a settlement that led to a criminal indictment (POCO, LLC v. Farmer's Crop Insurance Alliance, Inc., No. 16-35310, 9th Cir.).
Reinsurer Seeks To Amend Complaint In Breach Of Contract, Bad Faith Suit
WASHINGTON, D.C. - Parties in a reinsurance dispute recently debated whether a federal judge in the District of Columbia should allow a reinsurer to amend its complaint against the Federal Crop Insurance Corp. (FCIC) (ACE American Insurance Co., et al. v. Federal Crop Insurance Corp., et al., No. 14-1992, D. D.C.).
Reinsurer Wants To Leave Reinsurance Arbitration Dispute With Arbitration Panel
NEW YORK - A reinsurer asked a federal court in New York on Jan. 25 to place a dispute regarding reinsurance of workers' compensation risks in the hands of an arbitration panel to decide (In the Matter of the Arbitration Between National Union Fire Insurance Company of Pittsburgh, PA v. Federal Insurance Company, No. 16-cv-08821, S.D. N.Y.).
Nonresidents Say Court Does Not Hold Jurisdiction Over Them
ATLANTA - A group of defendants who were sued for the return of reinsurance funds allegedly transferred to them fraudulently argue in a Jan. 17 brief filed in a federal court in Georgia that the court does not hold jurisdiction over them (Canal Insurance Company, et al. v. Golden Isles Reinsurance Company, Ltd, et al., No. 15-cv-3331, N.D. Ga.).
Extreme Fronting Arrangements And Their Impact On Arbitration Rights
By Robert M. Hall I. Introduction The insurance industry does (or should) understand well the dangers of extreme fronting arrangements i.e. when a reinsurer controls the underwriting and claims handling of the primary company, assuming all or a great majority of the underwriting risk. Regulators question whether the reinsurer is actually engaging in the business of insurance in their states and may inquire whether or not they are properly licensed to do so. Guaranty fund assessments, premium taxes and similar costs of doing a primary business may be assessed. Perhaps more important is the danger that reinsurers will subject themselves to Unfair Insurance Practices and similar statutes and regulations and direct actions against them by insureds and claimants.1 The same lessons seem to be offered repeatedly.
New York High Court Certifies Reinsurance Liability Cap Question
ALBANY, N.Y. - The New York Court of Appeals on Jan. 10 certified a question from the Second Circuit U.S. Court of Appeals regarding reinsurance liability cap limits as they relate to per-occurrence loss and expense (Global Reinsurance of America v. Century Indemnity Company, No. 34, N.Y. App.).
Panel Says Statute Of Limitation Ran Out Before Insurer Sued Its Employees
CHICAGO - An Illinois appellate court panel on Dec. 29 affirmed a lower court decision that the five-year statute of limitations had passed before an insurer sued two of its employees that were allegedly involved in a reinsurance scheme designed to defraud the insurer (Guarantee Trust Life Insurance Company v. Robert Kribbs, et al., No. 1-16-0672, Ill. App., 1st Div.; 2016 IL App (1st) 160672).
Judge Says Ruling That Document Was Privileged Was Not Clearly Erroneous
SYRACUSE, N.Y. - A federal judge in New York on Jan. 13 denied a reinsurer's challenge to a magistrate judge's ruling, finding that the magistrate judge's finding that a certain document was privileged was not clearly erroneous (Utica Mutual Insurance Company v. Munich Reinsurance America, Inc., No. 12-cv-00196, and Munich Reinsurance America, Inc., v. Utica Mutual Insurance Company, No. 13-cv-00743, N.D. N.Y.).
Assignee Says Lower Court Erred When It Said Statute Of Limitations Expired
CHICAGO - The assignee of certain reinsurance recoverables of an insolvent insurer contends in a Dec. 15 brief to the Seventh Circuit U.S. Court of Appeals that the statute of limitations of a breach of contract claim accrues differently when the reinsured is an insurer in liquidation (Pine Top Receivables of Illinois, LLC v. Banco De Seguros Del Estado, No. 16-3499, 7th Cir.).
Insurer Says Court Should Decide If Dispute Can Be Arbitrated
NEW YORK - An insurer told a federal court in New York on Jan. 6 that the issue of whether a workers' compensation claim dispute can be arbitrated and what parties should participate in the arbitration is up to the court and not up to a panel of arbitrators to decide (In the Matter of the Arbitration Between National Union Fire Insurance Company of Pittsburgh, PA v. Federal Insurance Company, No. 16-cv-08821, S.D. N.Y.).
Reinsurers Say They Do Not Oppose Petition To Confirm Arbitration Award
NEW YORK - A group of London-based reinsurers told a federal court in New York on Jan. 9 that they do not oppose a reinsured's motion to confirm an asbestos related arbitration award (OneBeacon Insurance Company v. Certain Underwriters at Lloyd's London, No. 16-cv-09908, S.D. N.Y.).
Reinsureds Say Federal Court Holds Jurisdiction Over Individual Defendants
ATLANTA - Two reinsured insurers suing their reinsurer and others to recover alleged reinsurance obligations told a federal court in Georgia on Jan. 3 that four nonresident defendants have sufficient ties to Georgia to give the federal court jurisdiction over them (Canal Insurance Company, et al. v. Golden Isles Reinsurance Company, Ltd, et al., No. 15-cv-3331, N.D. Ga.).