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Aggregating Losses From the COVID-19 Crisis for Reinsurance Purposes

The question of whether hundreds or even thousands of COVID-19-related losses can be aggregated together as one “loss” or “occurrence” for reinsurance purposes is one that both ceding companies and reinsurers are pondering.  Expressly putting aside whether COVID-19-related business interruption losses are covered by underlying insurance policies (see our other blog posts), this post discusses … Continue Reading

Arbitration Should Play a Key Role in Resolving COVID-19 Insurance and Reinsurance Disputes

There are nearly 400 disputes in the courts about whether loss of business income because of the novel coronavirus is covered by the business income, extra expense and civil authority coverage grants found in many commercial property insurance policies.  Other disputes exist or will arise over different insurance coverage issues stemming from COVID-19.  Additionally, as … Continue Reading

June 2020 Reinsurance Newsletter

The Squire Patton Boggs June 2020 Reinsurance Newsletter is now available for your reading pleasure.  You can read the Newsletter on the Squire Patton Boggs website at this link.  In this issue we discuss the Second Circuit’s Utica v. Fireman’s Fund decision, which reversed a judgment for the cedent after a jury verdict.  We also … Continue Reading

The Novel Coronavirus and Reinsurance

I have updated my musings on insurance losses arising from the novel coronavirus and the issues that may arise should those losses become cessions to reinsurance contracts in my latest IRMI.com quarterly Reinsurance Commentary.  I hope you find it useful and would welcome comments and feedback.  You can access the Reinsurance Commentary by clicking the … Continue Reading

New York Federal Court Compels Arbitration in Life Reinsurance Dispute Over Trust Assets

Where two or more agreements are involved in a transaction, a dispute over one of the agreements often raises arbitrability questions.  This is especially true where a reinsurance agreement with an arbitration clause is paired with a trust agreement with no arbitration clause.  In a recent life reinsurance case, a New York federal court addressed … Continue Reading

Second Circuit Rules Summons Enforceable Under Section 7 of the Federal Arbitration Act

Because of the quasi-judicial nature of arbitration and the limited powers given to arbitrators under the Federal Arbitration Act (“FAA”) to control discovery, how a party to an arbitration goes about seeking evidence from a recalcitrant witness has caused some controversy.  Different courts have come up with different interpretations about whether arbitration subpoenas are enforceable … Continue Reading

COVID-19 Losses from a Reinsurer’s Perspective

This blog post provides some thoughts on addressing COVID-19 losses from the reinsurer’s perspective.  A reinsurer does not issue the underlying policies and does not handle the underlying claims.  A reinsurer relies upon its reinsured to adjust claims within the terms and conditions of the reinsured policies and the reinsurance contract.  Just like the ceding … Continue Reading

COVID-19 Losses From a Reinsured’s Perspective

This blog post provides some thoughts on addressing COVID-19 losses from the perspective of the reinsurance buyer: the reinsured or cedent.  A cedent has two main considerations when faced with a loss:  (1) is the loss a covered loss under the cedent’s insurance policies? and, (2) if the loss is a covered loss, is it … Continue Reading

Second Circuit Reverses Judgment for Cedent and Finds Reinsurer Not Liable for Asbestos Losses

In a significant reversal of a judgment for a cedent after a jury verdict, the Second Circuit Court of Appeals has held in favor of the reinsurer in an important follow-the-settlements case.  The court agreed with the reinsurer that, as a matter of law, it was not obligated to the cedent because the losses did … Continue Reading

COVID-19 Insurance-Related Blogs and Articles for March and April 2020

During March and April, the Squire Patton Boggs insurance group has authored several blog posts, alerts and articles on the insurance and reinsurance issues arising from the novel coronavirus pandemic.  These range from regulatory updates, to business interruption coverage analysis, to reinsurance issues.  We thought it might be good to list them here in one … Continue Reading

Final Arbitration Award Including Attorney Fees Confirmed

Awards of attorney fees are few and far between in reinsurance arbitrations, but they happen.  When they happen, the losing side sometimes seeks to vacate the award based on the arbitrators exceeding their powers in awarding attorney fees.  In a recent case, the court had to decide whether to confirm or vacate an award with … Continue Reading

Final Award Confirmed Over Interim Final Award in Reinsurance Dispute

Reinsurance arbitration panels, when asked, sometimes issue interim awards that address merits issues.  Often this happens when the parties need clarity on how to calculate a reinsurance billing.  The panel’s interim award may resolve certain issues and suggest that the parties meet and confer to see if they can now resolve the dispute, but if … Continue Reading

Some Preliminary Thoughts on Reinsurance Issues and COVID-19

All the talk about whether insurance policies will respond to COVID-19 losses causes me to think about how reinsurers will respond to COVID-19 losses if they are ceded.  There are lots of considerations, including whether the cedent’s loss payments were made on an ex gratia basis, whether civil authority orders change the dynamic, what lines … Continue Reading

Reverse Preemption Is Alive and Well in Washington State

Most reinsurance contracts have binding arbitration provisions.  The Federal Arbitration Act (FAA) sets out a national policy in favor of arbitration.  Yet, there are states that expressly preclude arbitration provisions in insurance contracts.  Does that apply to reinsurance contracts?… Continue Reading

Arbitrators to Decide If Reinsurance Rebilling After Final Arbitration Award Is Precluded

What happens when, after a reinsurance arbitration over how the ceding company billed the reinsurer is resolved in the reinsurer’s favor with a final award confirmed by the court, the ceding company rebills the reinsurer for the same losses (but differently than the way it did during the prior arbitration)?  If the reinsurer again denies … Continue Reading

Who Decides Whether a Reinsurer Is a Run-off Reinsurer?

In the past 10 years or so, several ceding companies began adding run-off reinsurer clauses to their reinsurance contracts to mitigate disputes that might arise with reinsurers no longer actively in business.  In a recent case, a Georgia federal court had to address whether it or an arbitration panel should determine whether the reinsurer was, … Continue Reading

March 2020 Reinsurance Newsletter

The Squire Patton Boggs Reinsurance Newsletter has been published.  The March 2020 Newsletter includes a discussion of a Third Circuit consolidation issue, reinsurance cases resulting from the recent hurricanes in Puerto Rico, an intervention case in the life reinsurance world, and, of course, our annual A Brief Review of Reinsurance Trends section covering the important … Continue Reading

Who Demands Arbitration Is Key to Whether Arbitration Will Be Compelled

Complex corporate structures and internal reinsurance relationships can complicate legacy reinsurance relationships.  This is especially true where the underlying losses are long-tail liabilities and where companies have changed, merged, combined and succeeded each other.  A key question for any legacy reinsurance treaty is whether the losses now being ceded come within the scope of the … Continue Reading

Extrinsic Evidence Leads to Summary Judgment on Aggregate Corridor Deductible

Some insurance programs are simple:  one primary policy, one excess policy.  Easy.  Some insurance programs are complex and contain many layers and coverages.  In the case discussed below, the court had to interpret how an Aggregate Corridor Deductible (ACD) in one policy worked and how it affected when the second policy came on risk.… Continue Reading

The Top 10 InReDisputesBlog Posts for 2019

Below are the top 10 blog posts from our Insurance & Reinsurance Disputes Blog for 2019.  These are the ones our readers viewed the most last year on our blog. The compilation is diverse as is the topic of insurance and reinsurance disputes.  Please enjoy this stroll down memory lane.  If you like these and … Continue Reading

Policyholder’s Attempt to Third-Party Reinsurers Denied

When a policyholder faces litigation from its insurance company over a claim submitted by the policyholder, the policyholder often will defend by alleging that the insurance company has breached the insurance contract and has wrongfully failed to pay the claim.  Sometimes, however, a policyholder will try to blame the insurance company’s refusal to pay a … Continue Reading

Life Reinsurer Gets Its Wish to Intervene

Life insurance policies issued in the past are often transferred in blocks to reinsurers on a 100% indemnity reinsurance basis.  These transfers often include servicing agreements, where the assuming reinsurer takes responsibility for all policy services, including determining the cost-of-insurance.  In the past several years, policyholders have brought putative class actions against life insurance companies … Continue Reading

Who Decides Consolidation Issue? A New Arbitration Panel or the Old One?

It is pretty well settled under modern arbitration law, including reinsurance arbitrations, that procedural issues like consolidation are questions for the arbitrators and not the courts.  But what happens if there are multiple arbitration panels?  Which panel decides the consolidation application?  And what if one arbitration has been completed and a motion to consolidate is … Continue Reading

Liquidator Compelled to Arbitrate Hurricane Reinsurance Disputes

The federal policy favoring arbitration sometimes bumps up against state-based receivers where the receiver would rather the receivership court address reinsurance disputes than have the matter arbitrated.  In the aftermath of Hurricanes Irma and Maria, which devastated Puerto Rico, reinsurance disputes arose over a cedent’s allocation between the hurricanes and other aspects of the many … Continue Reading
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