STORY FROM: Reinsurance & Arbitration
Agent Lacked Authority to Bind American Re To $2M Contract
May 14, 2008
OMAHA, Neb. - American Re-Insurance Co. is not obligated to contribute toward a $4.3 million settlement of claims arising from a deadly 2004 trucking accident because the reinsurance contract never existed, a Nebraska federal judge ruled May 6. Scottsdale Insurance Co. v. American Re-Insurance Co., No. 8:06CV16 (D. Neb.).
Chief Judge Joseph F. Bataillon of the District of Nebraska found that the underwriter, Hull & Company, Mid America Inc., did not have the authority to automatically place the reinsurance.
In 2004, Hull obtained $4 million in umbrella insurance from Continental Western Insurance Co. for Twin Lake Trucking Ltd. Hull then ...