The Insurance & Reinsurance Report

Svancara v. Rain and Hail LLC

(D. Neb., September 11, 2009)

Plaintiffs-policyholders purchased separate crop insurance policies from defendant-insurer through an agent.  The policies included identical clauses concerning arbitration.  The policyholders made separate claims under their individual policies for crop damage which the insurer denied.  The policyholders then proceeded to arbitration and the arbitrator returned separate awards in favor of the insurer on each of the policyholders’ claims.  The policyholders then filed suit in the district court claiming that the insurer …

Ario v. Reliance Ins. Co.

( Pa. Commw. Ct. September 4, 2009)

The court granted the summary judgment motions of two hospitals seeking treatment as third-party beneficiaries of reinsurance agreements where: (1) the primary insurer acted only as a fronting company in which capacity it did not accept an underwriting risk; (2) the primary insurer entered the transaction to generate fee income, not premium revenue; (3) the reinsurer acted as the direct insurer by funding and processing claims through its affiliate; (4) the hospitals chose …

PMA Capital Ins. Co. v. Platinum Underwriters Bermuda, LTD

(Eastern District of Pennsylvania, September 17, 2009)

A Reinsurer demanded arbitration, seeking a declaration with respect to calculation of the balance of the Experience Account under the reinsurance contract and that it was entitled to the “benefit deficit carry forward” under a prior contract with a different reinsurer.  The arbitrators awarded the reinsurer $6 million dollars within 30 days and eliminated the deficit carry forward provision in the contract in its entirety.  Finding that the …

Princeton Insurance Co. v. Converium Reinsurance (North America) Inc.

(Third Circuit, September 14, 2009)

In Princeton Insurance Company v. Converium Reinsurance (North America) Inc., the cedent and reinsurer entered into a treaty regarding workers’ compensation and employer’s liability policies.  The treaty provided reinsurance for claims exceeding $1 million. The treaty included a warranty which provided that  the cedent “warrants that the maximum Employer’s Liability limits are as follows, or so deemed:  i. Bodily Injury by Accident – $100,000 each accident.”…