Mealey's Insurance Insolvency
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July 07, 2022
Receiver: Modified Rehab Plan For Reinsurer Would Raise Rates For Some YRT Business
WILMINGTON, Del. — The receiver for Scottish Re (U.S.) Inc. in Rehabilitation (SRUS) on June 30 asked a Delaware state court to approve a modified plan of rehabilitation that includes remediative rate increases (RRIs) to correct the “underpricing” of some of its Yearly Renewable Term (YRT) business that was deemed largely responsible for the reinsurer’s financial distress.
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July 07, 2022
Specialty Insurer Says Insolvency Exclusion Bars Coverage Of MA Plan Insurer
CENTRAL ISLIP, N.Y. — A specialty insurer on June 30 moved for judgment on the pleadings in New York federal court in a Medicare Advantage (MA) plan insurer’s suit seeking a judgment that the specialty insurer is obligated to reimburse the plan insurer for losses in an underlying suit filed against it, contending that insolvency, managed care services and contract exclusions bar coverage.
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July 01, 2022
Judge Rules On Evidence, Summary Judgment Motions In Shipyard Asbestos Case
NEW ORLEANS — A federal judge in Louisiana on June 15 issued a series of orders in which he admitted an asbestos expert, excluded evidence of collateral income sources and settlements and granted summary judgment to two defendants after finding the Longshore and Harbor Workers’ Compensation Act (LHWCA) provides the exclusive remedy for claims against a man’s employer.
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June 30, 2022
Federal Judge Dismisses Asbestos Suit Cross-Claims Against Insurer, Corporations
NEW ORLEANS — One day after a shipbuilder defendant moved to dismiss its claims against cross-claim and third-party defendants in an asbestos liability coverage suit filed against corporations and their insurers, alleging that a man contracted malignant mesothelioma and died due to his inhalation of asbestos fibers, a Louisiana federal judge on June 21 granted the motion without prejudice.
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June 30, 2022
Receiver Moves For Default Against Broker In Insolvent Health Plan Suit
CHICAGO — An independent fiduciary receiver on June 22 filed two motions in Illinois federal court, the first for voluntary dismissal against one broker defendant and the second for entry of default against another broker defendant in a breach of duty of care suit against insurance brokers, alleging that they knew or should have known that a multiple employer welfare arrangement (MEWA) lacked compliance with its structural requirements.
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June 28, 2022
Liability Insurer Says It’s Not Obligated To Indemnify In Antitrust Coverage Row
KANSAS CITY, Kan. — A liability insurer on June 24 filed a brief with a Kansas federal court in support of its cross-motion for judgment on the pleadings in an antitrust coverage dispute involving a liability policy it issued to a health care insurer, contending that “[b]ecause every aspect of the alleged conspiracy falls within the definition of Managed Care Activities [MCA], the MCA Exclusion applies to bar coverage” of the health care insurer.
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June 22, 2022
JPMDL Says ‘Centralization Appears Premature’ In Insurance Rehab Case
WASHINGTON, D.C. — The U.S. Judicial Panel for Multidistrict Litigation on June 1 denied an insolvent insurer and its rehabilitators’ motion to transfer and centralize litigation against them to a Pennsylvania federal court, finding that the insurer and its rehabilitators failed to meet the burden of demonstrating “that the benefits of centralization outweigh the disruption to the pending actions and inconvenience that would be imposed on the parties and witnesses.”
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June 22, 2022
Nevada High Court: Insolvent Insurers’ Directors Didn’t ‘Demonstrate’ Jurisdiction
LAS VEGAS — Directors of an insolvent Nevada risk retention group failed to “demonstrate” that the high court had jurisdiction in an insurance commissioner’s breach of fiduciary and gross negligence suit against them, the Nevada Supreme Court ruled June 6, dismissing the directors’ appeal of district court orders denying their motion for attorney fees and the Nevada insurance commissioner’s motion to retax and settle costs.
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June 21, 2022
Louisiana Federal Judge Grants Ex Parte Dismissals In Asbestos Liability Suit
NEW ORLEANS — Almost two weeks after granting an ex parte joint motion to dismiss with prejudice, a Louisiana federal judge on June 13 issued an order granting plaintiffs’ ex parte motion to dismiss with prejudice against specified defendants in an asbestos liability coverage suit alleging that a man contracted malignant mesothelioma and died due to his inhalation of asbestos fibers.
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June 20, 2022
Full Aggregate Policy Limits Apply To Insured’s Policies, 2nd Circuit Panel Says
NEW YORK — The Second Circuit U.S. Court of Appeals on June 16 reversed a district court’s ruling that the full aggregate policy limits do not apply to an insured’s policies that were effective for less than a full year because the policies at issue are ambiguous as to whether the full aggregate limits should apply for underlying asbestos liabilities and must be construed in favor of the insured.
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June 15, 2022
Magistrate Judge: Asbestos Plaintiffs Don’t Have Info Guaranty Association Seeks
BATON ROUGE, La. — A Louisiana federal magistrate judge on June 13 denied a motion to compel responses to discovery filed by the Louisiana Insurance Guaranty Association (LIGA), the statutory obliger for an insolvent insurer in an asbestos exposure suit filed against the insurer, finding that plaintiffs lack the information requested and that LIGA’s settlement-related request is “premature.”
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June 15, 2022
Bankruptcy Judge Gives Insurer’s Liquidators OK For Dozens Of Subpoenas
NEW YORK — In three orders issued June 14, a New York federal bankruptcy judge authorized the joint provisional liquidators (JPLs) of Bermuda insurer and reinsurer PB Life and Annuity Co. Ltd. (PBLA) and other debtors to issue subpoenas directing production of documents to dozens of entities and individuals including debtor investment counterparties and certain non-insider third parties — of which the latter includes Google LLC.
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June 14, 2022
Health Plan Directors Issue Status Report In Suit Against Insolvent Insurer
AKRON, Ohio — Liberty HealthShare Inc., its CEOs and directors on June 8 issued a status report to an Ohio federal court in a class action filed by health insurance plan members seeking a declaration that the health plans “were and are illegal contracts” and a ruling that the CEOs or directors were personally liable after Liberty was deemed an insolvent insurer under Virginia Code Annotated Section 38.2-215.
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June 14, 2022
Panel Affirms Dismissal Of Insurer Conservatorship Suits, Splits On Abstention
SAN FRANCISCO — Ruling 2-1 that abstention under Younger v. Harris does not apply to insurance conservatorships, members of a Ninth Circuit U.S. Court of Appeals panel on June 10 affirmed a lower court’s dismissal of two suits involving the same state court proceeding under the prior exclusive jurisdiction rule; the majority said it believes that this is “the first case in this Court implicating” that rule “in connection with a 42 U.S.C. § 1983 action.”
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June 09, 2022
Trial Dropped For Summary Judgment In Reinsurer’s Suit Over Defense, Indemnity
NEW YORK — A federal judge in New York on June 6 granted a request by both parties in a declaratory judgment suit over defense and indemnity costs that, in lieu of conducting a bench trial scheduled to start July 25, he will “decide all issues on the papers submitted in the pending motions for summary judgment, inclusive of issues of fact, if any.”
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June 08, 2022
Settlement Meeting Held Between Fiduciary, Brokers In Insolvent Health Plan Suit
CHICAGO — A federal magistrate judge in a June 7 minute entry directed parties to file settlement position opening statements by Aug. 1 following a pre-settlement conference in a lawsuit alleging that insurance brokers breached their duty of care because they knew or should have known that a multiple employer welfare arrangement (MEWA) was not in compliance with its structural requirements and was not financially sound.
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June 08, 2022
Preliminary Injunction Motion Withdrawn In Fraudulent Transfer Suit Against Insurer
WILMINGTON, Del. — Citing changes in the defendants’ plans, the plaintiffs in a putative class suit alleging fraudulent transfers from an insurance subsidiary that more than 1 million policyholders depend on for long-term care (LTC) insurance disability benefits informed the Delaware Chancery Court in a June 3 letter that they are withdrawing their motion for a preliminary injunction.
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June 06, 2022
North Carolina Judge Tosses Insolvent Insurer’s Legal Malpractice Claim
CHARLOTTE, N.C. — A North Carolina judge on May 24 granted a law firm’s summary judgment motion in a legal malpractice claim filed against it by the owner of an insolvent insurer, finding that the owner failed to provide evidence that the firm could have changed the result of a trial court’s judgment in an underlying $12,849,193.20 judgment against the owner for breach of fiduciary duty, constructive fraud, constructive fraudulent transfer and unfair and deceptive trade practices.
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June 06, 2022
Magistrate Judge Denies Joint Motion To Stay In Antitrust Coverage Dispute
KANSAS CITY, Kan. — A federal magistrate judge in a May 23 docket entry denied a joint unopposed motion to stay two claims regarding antitrust coverage disputes involving an insolvent insurer and health care insurer, finding that despite the consolidated cases’ “complexity,” they “need to move forward regardless of the outcome of mediation.”
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June 01, 2022
Federal Judge Grants Attorney Fees To Insurer Subclass In Risk-Corridor Dispute
WASHINGTON, D.C — Five days after a U.S. Court of Claims judge issued an order approving an attorney fee request made by counsel for insolvent insurers’ subclass for 5% of the $13,714,723 net recovery related to the settlement of risk-corridor claims, the court on May 31 issued a judgment awarding class counsel $685,736 in attorney fees in a suit seeking a declaratory judgment that the U.S. government owes the insurers millions of dollars under the Patient Protection and Affordable Care Act (ACA) risk-corridor program.