Third Circuit Affirms Denial of Reinsurance Contract Rescission

Munich Reinsurance America, Inc. (“Munich”) provided reinsurance coverage to Everest National Insurance Co. (“Everest”) on workers compensation claims.  Munich then sought reinsurance coverage for its own liability and did so from Continental Casualty Insurance Co. (“Continental”).  Eventually, the independent underwriter that represented Continental in the deal informed Munich that it no longer underwrote coverage for Continental.  At that time, the underwriter suggested replacing Continental with American National Insurance Company (“ANICO”).  Munich gave the underwriter the same files Munich received from
Continue reading...

Federal Insurance Office Issues Reinsurance Report

Among other provisions, Title V of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) authorizes the Federal Insurance Office (the FIO) to monitor all aspects of the insurance industry, including reinsurance. {Dodd-Frank Act, §§ 501-502; 31 U.S.C. § 313 (c)(1)(A) (2010)}. On December 31, 2014, pursuant to Title V of the Dodd-Frank Act, the FIO issued its report on reinsurance entitled “The Breadth and Scope of the Global Reinsurance Market and the Critical Role Such Market Plays in
Continue reading...

Second Circuit Holds “Loss Expenses” Not Categorically Excluded from Liability Limit of Facultative Reinsurance Certificate

In Utica Mutual Insurance Co. v. Munich Reinsurance America, Inc., the Second Circuit Court of Appeals reversed and remanded a summary judgment determination against a reinsurer with regard to the reinsurer’s obligations to reimburse the insured’s claim expenses. Utica Mutual Insurance Company had issued an umbrella policy to Goulds Pumps, Inc. Utica incurred millions of dollars of losses under this policy due to asbestos-related litigation brought against Goulds. Munich Reinsurance reinsured Utica’s umbrella policy under a facultative reinsurance certificate that
Continue reading...

Reinsurance Review Is Now Available

For a free copy of this month’s edition, click here.  Goldberg Segalla’s Reinsurance Review provides timely summaries of and access to the latest reinsurance law developments worldwide. For ease of reference, we have organized the cases by court and date. In addition, we provide the latest information regarding news in the insurance and reinsurance industries. To receive this publication for free each month, please contact Jeff Kingsley at jkingsley@goldbergsegalla.com.  
Continue reading...

New York Court Predicts California’s Future: Allows Bad Faith Exception in Reinsurance Late Notice Defense

Ins. Co. of the State of Penn. v. Argonaut Ins. Co. U.S. Dist. Ct., S.D.N.Y. (August 6, 2013) In this case, the cedent sued its reinsurer when it denied coverage because of late notice of its claim.  Both parties filed a motion for summary judgment arguing the applicability of the late notice defense.  The court granted the reinsurer’s motion. From 1980-2009, a series of disputes and negotiations arose regarding asbestos claims against the underlying insured.  It was not until 2009,
Continue reading...

Cases for Reinsurance Review – May 2013 Edition

Cases provided courtesy of LexisNexis AIU INS. CO. V. TIG INS. CO. BEAZLEY UNDERWRITING LIMITED AND OTHERS V. AL AHLEIA INSURANCE COMPANY AND OTHER COMPANIES BURKE V. ABILITY INS. CO. MUNICH REINSURANCE AM., INC. V. AM. NAT’L INS. CO. NEW HAMPSHIRE INS. CO. V. MAGELLAN REINSURANCE CO. NEW JERSEY PHYSICIANS UNITED RECIPROCAL EXCHANGE V. ACE UNDERWRITING AGENCIES LTD. OLYMPUS INSURANCE CO. V. AON BENFIELD, INC. PINE TOP RECEIVABLES OF ILLINOIS, LLC V. BANCO DE SEGUROS DEL ESTADO THE INSURANCE CO.
Continue reading...

Reinsurers Kept on the Hook Despite Cedent’s Settlement in $28 Million Kuwait Oil Claim

Beazley Underwriting Limited and others v Al Ahleia Insurance Company and other companies [2013] EWHC 677 (Comm) This case centers on the relationship between cedents and reinsurers and compliance with a claims control clause which requires the cedent to allow the reinsurers to control aspects of claim handling. In this case the claimant reinsurers claim they are not liable under the reinsurance policy while the cedents assert that the reinsurer owes coverage. By way of background, on October 3, 2005
Continue reading...

The Inside Scoop From the 2011 Inside FAC Monte Carlo Roundtable

Goldberg Segalla partners Dan Gerber and Jeff Kingsley joined top-level reinsurance industry representatives and thought leaders as participants in the Inside FAC Roundtable, held during the September 2011 Reinsurance Rendez-Vous in Monte Carlo. The discussion addressed numerous critical issues affecting reinsurers, cedants, underwriters and others today and into the future. Visit the Goldberg Segalla website for a full transcript of the Inside FAC Roundtable discussion.
Continue reading...