Mealey's Reinsurance
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November 5, 2018
Discovery Protective Order Issued In Dispute Between Run-Off Insurer, Reinsurers
NEW YORK — A New York federal judge on Nov. 1 issued a protective order regarding discovery in a case between a run-off insurer, reinsurers and the reinsurers’ related entities over allegations of mismanagement and misuse of $320 million in investments (Senior Health Insurance Company of Pennsylvania v. Beechwood Re Ltd., et al., No. 18-06658, S.D. N.Y.).
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November 5, 2018
Judge Addresses Motions To Dismiss Deceptive Acts, Illegal Kickback Lawsuit
HONOLULU — Addressing motions to dismiss, a Hawaii federal judge on Nov. 2 dismissed in part claims in a homeowner’s second amended complaint alleging unfair or deceptive acts or practices in the placement of insurance, “with unreasonable and inflated premiums” that included “improper compensation through illegal kickback or captive reinsurance arrangements” (Julia Wieck v. CIT Bank, N.A., et al., No. 16-00596, D. Hawaii, 2018 U.S. Dist. LEXIS 188022).
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November 5, 2018
Insurer Dismisses Petition To Appoint Umpire For Reinsurance Dispute
AKRON, Ohio — An insurer notified an Ohio federal court on Nov. 7 that it was voluntarily dismissing its petition requesting appointment of an umpire for an arbitration panel regarding a dispute under a reinsurance agreement (Envision Insurance Co. v. Hannover Life Reassurance Company of America, No. 18-02047, N.D. Ohio).
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November 5, 2018
SEC Alleges Schemes To Defraud Insurers, Reinsurance Trusts
NEW YORK — In an Oct. 16 complaint filed in a New York federal court, the Securities and Exchange Commission alleges that two individuals “perpetrated multiple schemes to defraud their advisory clients, which were insurance companies and reinsurance trusts” (Securities and Exchange Commission v. Alexander C. Burns, et al., No. 18-09477, S.D. N.Y.).
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November 1, 2018
Liquidator Seeks Remand Of Reinsurer’s Dispute To Confirm Arbitration Award
CHICAGO — An insolvent insurer’s liquidator on Oct. 29 moved to remand a reinsurer’s Illinois federal court dispute seeking confirmation of an arbitration award for $437,000 in attorney fees and also filed its reply to a previous motion to dismiss or stay based on a lack of subject matter jurisdiction (Catalina Holdings [Bermuda] Ltd. v. Jennifer Hammer, No. 18-05642, N.D. Ill.).
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November 1, 2018
Insurer Amicus Filer Backs Rehearing On Reinsurer’s Liability
NEW YORK — An insurance company on Oct 19 filed an amicus curiae brief in support of a rehearing by the Second Circuit U.S. Court of Appeals of its ruling that a reinsurer’s liability follows an insurer’s expense‐supplemental obligations under umbrella policies because the insurer says the decision is “contrary to bedrock principles of reinsurance law and sound public policy favoring settlements” (Utica Mutual Insurance Co. v. Clearwater Insurance Co., Nos. 16-2535 & 16-2824, 2nd Cir.).
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October 31, 2018
Judge Orders Insurance Broker’s Former Owner To Address Contempt Application
SAN DIEGO — In a case over breached reinsurance agreements from fraudulent transfers, a California federal judge on Oct. 15 allowed an insurance broker’s former owner time to respond to why she should not be held in contempt of court regarding an injunction order (Odyssey Reinsurance Co. v. Richard Keith Nagby, et al., No. 16-3038, S.D. Calif.).
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October 31, 2018
Run-Off Insurer Opposes Reinsurer’s Dismissal Of Claims In Mishandling Suit
NEW YORK — In a New York federal case alleging mismanagement and misuse of $320 million in investments, a run-off insurer argues in an Oct. 29 opposition that reinsurers and related entities fail to address allegations of their active participation in a fraudulent conspiracy in their motion to partially dismiss claims (Senior Health Insurance Company of Pennsylvania v. Beechwood Re Ltd., et al., No. 18-06658, S.D. N.Y.).
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October 30, 2018
Reinsurer, Insurer Argue Over Bifurcated Discovery In Breach Of Contract Suit
DETROIT — A reinsurer and insurer in separate Oct. 12 briefs argue for and against bifurcated discovery in a breach of contract Michigan federal court case over coverage for asbestos claims (Amerisure Mutual Insurance Co. v. Transatlantic Reinsurance Co., No. 18-11966, E.D. Mich.).
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October 30, 2018
Nicaraguan Insurer, New York Reinsurer Sued For Breach Of Contract
MIAMI — The owner of a plastics manufacturing plant that suffered a fire loss sued the government of the Republic of Nicaragua, a Nicaraguan insurer and a New York reinsurer on Oct. 17 in a Florida federal court for breach of contract and unjust enrichment (Farouk Morales v. The Government of the Republic of Nicaragua, et al., No. 18-24301, S.D. Fla.).
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October 30, 2018
Reinsurer Opposes Class Certification In Dispute Over Workers’ Comp Program
SACRAMENTO, Calif. — A reinsurer and its affiliates in an Oct. 12 opposition brief ask that a California federal court deny classification in two putative class actions over a reinsurance participation agreement (RPA) of hundreds of California businesses that bought a workers’ compensation program (Shasta Linen Supply Inc. v. Applied Underwriters Inc., et al., Nos. 16-00158 & 16-01211, E.D. Calif.).
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October 29, 2018
High Court Denies Review Of Ruling As To Insurers, Reinsurers’ 5th Amendment Rights
WASHINGTON, D.C. — The U.S. Supreme Court on Oct. 29 denied certiorari review of the Federal Circuit U.S. Court of Appeals’ finding that the U.S. government's termination of insurers and reinsurers’ lawsuits pursuant to a claims settlement agreement between it and Libya and its subsequent legislation and executive order did not constitute a compensable taking under the Fifth Amendment (Aviation & General Insurance Company Ltd., et al. v. United States, No. 17-1164, U.S. Sup.).
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October 26, 2018
Judge Sets Discovery Deadline In Fraud Case Against Life Insurer
BALTIMORE — In a dispute over a life insurer’s alleged hiding of its financial status under captive reinsurance schemes and the insurer’s cost of insurance (COI) rate increases, a Maryland federal judge on Oct. 24 scheduled the discovery deadline in the case for March 8, 2019 (Leslie S. Rich v. William Penn Life Insurance Company of New York, No. 17-2026, D. Md.).
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October 26, 2018
Investor Dismisses Bank From Case Over Depletion Of Life Insurers’ Assets
KANSAS CITY, Kan. — In a Kansas federal court lawsuit alleging that life insurers and a financial services firm depleted the life insurers’ surplus assets by reinsuring their risks with one another rather than using “arm’s-length reinsurance treaties,” a total value annuity investor voluntarily dismissed a bank without prejudice on Oct. 24 (Albert Ogles v. Security Benefit Life Insurance Co., et al., No. 18-02265, D. Kan.).
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October 25, 2018
Judge Orders Production Of Insurer’s Reinsurance In Defects Coverage Case
CHARLESTON, S.C. — A South Carolina federal judge on Oct. 24 declined to stay a coverage dispute over a defectively constructed project for an in camera review and instead ordered an insurer to produce documents pertaining to reinsurance and reserves (ContraVest Inc., et al. v. Mt. Hawley Insurance Co., No. 15-00304, D. S.C., 2018 U.S. Dist. LEXIS 182196).
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October 24, 2018
ACA Reinsurance Program Payments Not A Tax, 4th Circuit Rules
RICHMOND, Va. — A health care plan’s payments under the Patient Protection and Affordable Care Act (ACA) reinsurance program do not constitute a tax, a panel of the Fourth Circuit U.S. Court of Appeals said Oct. 23 (The Electrical Welfare Trust Fund, et al. v. United States, et al., No. 17-1937, 4th Cir., 2018 U.S. App. LEXIS 29856).
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October 22, 2018
Panel: Reinsurer’s Arbitration Provisions Are Unenforceable Based On Violation
RIVERSIDE, Calif. — A violation by a reinsurer and related entities of California Insurance Code Section 11658 renders arbitration provisions unenforceable, a California appeals panel held Oct. 19, affirming a lower court’s denial of motions to compel arbitration of a dispute involving workers’ compensation insurance (Low Desert Empire Pizza Inc., et al. v. Applied Underwriters Inc., et al., No. E067081, Calif. App., 4th Dist., Div. 2, 2018 Cal. App. Unpub. LEXIS 7154).
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October 19, 2018
Plaintiff Opposes Dismissal Of Contract, Bad Faith Claims Against Reinsurer
MONTGOMERY, Ala. — A reinsurer’s motion to dismiss breach of contract, bad faith and fraud claims should be denied, according to a plaintiff’s Oct. 16 brief in an Alabama federal court over the denial of benefits under four long-term disability insurance policies (Horace R. Theriot Jr. v. The Northwestern Mutual Life Insurance Co., et al., No. 18-688, M.D. Ala.).
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October 18, 2018
Reinsurers Seek Partial Dismissal Of Run-Off Insurer’s Mismanagement Lawsuit
NEW YORK — In a run-off insurer’s New York federal case alleging mismanagement and misuse of $320 million in investments, reinsurers, their affiliates and current and former owners, officers and insiders in an Oct. 15 motion seek partial dismissal of all claims that are duplicative of the ones for breach of contract (Senior Health Insurance Company of Pennsylvania v. Beechwood Re Ltd., et al., No. 18-06658, S.D. N.Y.).
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October 18, 2018
Reinsurer Asks Court To Confirm Arbitration Award Against Insolvent Insurer
CHICAGO — Opposing a request for dismissal by an insolvent insurer’s liquidator, a reinsurer argues in an Oct. 15 brief that an Illinois federal court has jurisdiction to confirm an arbitration award for $437,000 in attorney fees (Catalina Holdings (Bermuda) Ltd. v. Jennifer Hammer, No. 18-05642, N.D. Ill.).