When a reinsurance arbitration is conducted under non-neutral rules or practices, when and how ex parte communications are allowed to take place between a party’s counsel and a party’s party-appointed arbitrator are important items to resolve at the organizational meeting. A typical, but not universal, formulation is to cut-off ex parte communications when the first pre-hearing briefs are filed. Ex parte communications typically are allowed to resume when the final award is issued. When there are motions made, typically ex parte communications cease when the first motion brief or request for a ruling is filed and are not recommenced on that issue until the panel rules. So what happens if the arbitration panel issues an interim final award resolving the substantive issue in the dispute on the merits, but requires additional briefing on damages? May ex parte communications recommence after the interim final award?
Most of our posts discuss disputes involving specific claims or specific insurance or reinsurance contracts. But sometimes disputes arise in the regulatory context. This post is about the cost of catastrophe reinsurance protection, which factors into homeowners insurance rates rates used to develop the premiums charged to policyholders. This is especially relevant in states where natural catastrophes like hurricanes take place.
Recently, in ACE American Ins. Co. v. Fireman’s Fund Ins. Co., 16 C.D.O.S. 8430, the California Court of Appeal (Second District) addressed a split between divisions of that district regarding whether, as a matter of law, an excess insurer could sue a primary for subrogation where a settlement within primary limits was rejected and the excess paid as part of a settlement beyond the primary limits. In that case, the underlying plaintiff was injured while working on a film set.
Late notice of claim in both direct insurance and reinsurance are important issues. There are both contract and public policy issues that arise when considering if late notice will allow an insurer or reinsurer to avoid its obligations. We have authored a number blog posts here and IRMI.com commentaries on late notice issues in insurance and in reinsurance.
In a number of jurisdictions an insurer or reinsurer claiming late notice cannot avoid its obligation under the insurance or reinsurance contract unless it can show actual prejudice. This post will focus on the issue of what constitutes actual and substantial prejudice.
You know the old saying: if it walks like a duck and quacks like a duck it must be a duck! So when a contract is called a Facultative Reinsurance Agreement is it a reinsurance contract or an insurance contract? Recently a Missouri appellate court addressed this issue to determine an appeal of the denial of a motion to compel arbitration in the face of a Missouri law that prohibits mandatory arbitration clauses in insurance contracts.
Most significant insureds that provide services purchase both directors and officers liability insurance (“D&O”) and errors and omissions insurance (“E&O”). When the services provided are that of a stock exchange, claims by investors against the exchange for wrongful acts concerning the listing of a security may implicate both types of coverage. In a recent case, a court construed the interplay between these coverages and the application of the professional services exclusion typically found in D&O policies.
In my last blog post, I looked in overview at the Insurance Act 2015 (the “Act“), which comes into force in England and Wales on 12 August 2016 and revolutionises insurance contract law. This post looks at the potential for disputes arising from the new provisions of the Act, and how insurers could look to manage the risks.
The Insurance Act 2015 (the “Act”), which comes into force on 12 August 2016, is the most significant reform of English insurance contract law for over 100 years. The provisions of the Act apply to all (non-consumer) contracts of insurance and reinsurance that are governed by English law regardless of the country in which the policy is underwritten. It also applies to any variations to existing insurance contracts made after 12 August 2016. The Act tries to help the level the commercial playing field in the English insurance market by addressing what is perceived to be a legal imbalance in favour of insurers. It also updates existing (and arguably outdated) rules which no longer reflects good market practice in the 21st century.
One of the most vexing issues facing parties in reinsurance arbitrations is whether the other side’s party-appointed arbitrator qualifies under the arbitrator criteria set forth in the arbitration clause of the reinsurance agreement. The issue is frustrating because sometimes the arbitrator criteria is not as clear as it should be, which leaves room for creative appointments. It is also frustrating because when a counter-party appoints an arbitrator that arguably does not qualify, there is very little that the other party can do about it.
Collateral disputes over the qualifications of the arbitration panel may seem to be a great waste of time and money, but given the existing party-appointed system of advocate-arbitrators that has yet to be replaced by a neutral panel system, the make-up of an arbitration panel is seen as critical to a successful outcome. For this reason, parties are sometimes hesitant to go forward with panel selection when the other side appoints an arbitrator that may not qualify under the criteria established by the arbitration clause.
If a party believes that the opposing party’s arbitrator is not qualified, the party may object to the appointment and request the other party to replace its arbitrator with a qualified candidate. If the other party refuses, the objecting party must decide whether to challenge the appointment or go forward with umpire selection under a reservation of rights.
In a recent case, a Massachusetts federal court had an opportunity to address an objector’s challenge to a party-appointed arbitrator as part of a pre-award petition to remove the arbitrator and enforce the arbitration agreement. That challenge failed.
Like many automobile no-fault systems, New York’s no-fault law provides that in an auto accident, each injured person or their medical provider is entitled to direct reimbursement for medical expenses regardless of fault from each person’s own automobile no-fault insurer. So what happens if the medical providers bill the injured person’s health insurer instead of the no-fault insurer and the health insurer pays the bills? The New York Court of Appeals just answered that question.