Category: Blog

Parties’ Choice of Law Prevails: Arbitration Compelled

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Arbitration provisions in insurance agreements often come under attack when one of the parties to a dispute invokes a state law anti-arbitration provision to oppose a motion to compel arbitration. In many of these disputes, the court has to determine what state law governs the dispute. In a recent case, a federal magistrate judge recommended that the insurer’s motion to compel arbitration be denied because of a state’s anti-arbitration law but the federal district court disagreed.

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Insured vs Insured Exclusion Precludes Coverage

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In many insurance policies, particularly directors and officers liability policies, coverage is precluded if one insured brings a claim against another insured. But what happens if one of the named plaintiffs is not an insured party? A recent Sixth Circuit Court of Appeals case addresses this issue.

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Weapons Exclusion Precludes Coverage

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Courts are tough on exclusions but when an exclusion is clear it will preclude coverage. In a recent case, an exclusion for bodily injury arising out of weapons resulted in a coverage case being dismissed

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Reinsurer Prevails in HMO Excess Reinsurance Dispute

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You don’t see a lot of healthcare reinsurance disputes but in the case discussed below a dispute arose after a heart transplant took place. A motion to dismiss the complaint was granted (or at least recommended by the Magistrate Judge). It involves statutory construction.

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No Privilege for Information Provided to Reinsurer

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In coverage disputes, policyholders often seek communications between the insurance company and reinsurers to gain insights into the company’s views on the policyholder’s claims. Insurance companies generally resist production of reinsurance communications on various theories. In a recent case, the insurer invoked the “insurer-insured privilege.”

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Michigan Federal Court Holds Arbitrator to Decide Arbitrability Timeliness Dispute

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Who decides whether an arbitration should go forward is often a controversial issue. Is it the court or is it the arbitration panel? In a recent case, a Michigan federal court determined that it was the arbitrators that had to decide whether a limitations provision in a reinsurance contract precluded arbitration.

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The Reinsurer’s Right to Information

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In my latest Reinsurance Commentary for IRMI.com, I have revised a 2004 commentary on the access to records clause and related issues. With the numerous requests for “reinsurance information” in coverage cases, the issue of what information is a reinsurer entitled to and what information needs to be withheld because of privilege concerns has only grown in importance. This commentary discusses the reinsurer’s rights under the access to records clause, its purpose and its limits. I hope you find it useful. Click here for access. For more Reinsurance Commentaries, click here.

Seventh Circuit Reiterates the Great Deference Given to Arbitral Awards

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The great deference given to arbitrators and their awards is unquestionable in the US. Under the Federal Arbitration Act, there is no appeal of an arbitral award. Parties can only seek to modify, vacate or confirm an arbitration award. The court’s scope of review of an arbitration award is narrow. Where, as in reinsurance arbitrations, arbitrators are given even greater leeway to decide cases–especially where there is an honorable engagement clause–the courts’ scope of review of an arbitration award is restricted even further.

In a recent case, the Seventh Circuit reiterated these concepts in the context of a reinsurance arbitration with multiple awards involving the billing of asbestos-related losses.

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Puerto Rico Federal Court Compels Arbitration Under the New York Convention

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I recently posted about the Ninth Circuit’s decision compelling arbitration under the New York Convention after holding that the McCarran-Ferguson Act did not reverse preempt the Convention. Two months earlier, the federal district court in Puerto Rico reached the same conclusion.

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Confirming a Reinsurance Arbitration Award

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Reinsurance arbitration awards, like most commercial arbitration awards, are subject to confirmation in the courts. This turns the final arbitration award into a court judgment ripe for enforcement if necessary. This is nothing new and when there is no opposition to the petition to confirm there is no mystery as to the result. While the odd case does exist where the court will not confirm an arbitration award, generally an unopposed confirmation will be granted. So why talk about this then? Because sometimes it is good to revisit basic rules and concepts. That’s what a federal court did recently in confirming an unopposed reinsurance arbitration award.

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