STORY FROM: Reinsurance & Arbitration

Arbitration Agreement in Reinsurance Participation Agreement Not Enforceable, Calif. Court Affirms

SAN FRANCISCO — An arbitration agreement and delegation clause in a reinsurance participation agreement related to Applied Underwriters Inc.’s workers’ compensation insurance program are unenforceable because they were never filed with California regulators, a state appellate court has ruled.

In a Dec. 4 opinion, the California Court of Appeal, 1st District, found the delegation clause is a collateral agreement that should have been filed with regulators because it altered the dispute resolution terms of the related workers’ compensation policy.

In 2012, Luxor retained Heffernan Insurance Brokers to provide it with workers’ compensation insurance quotes and Heffernan presented Luxor with the ...

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