It happens ever so often. A policyholder will sue for coverage and will join its insurer’s reinsurer in the lawsuit. The majority rule in most US jurisdictions is that unless there is contractual privity between the policyholder and the reinsurer, a direct action is not allowed and the reinsurer will be dismissed from the case. While there are a few states that allow for direct actions against reinsurers, those typically are under special circumstances.

In most insurance arrangements, the policyholder is not aware of whatever reinsurance relationships have been entered into by its insurance company. In most reinsurance arrangements, the policyholder is not a party and the reinsurance contract typically has a provision that makes it clear that there are no third-party beneficiaries. There are, of course, exceptions to the rule, but not in a recent Florida case.