Reinsurer's $630,000 Offset Was Proper, State Court Rules

TALLAHASSEE, Fla. - A reinsurer properly offset $630,000 in unpaid premiums when it paid a now-insolvent insurer the limits of a $2 million reinsurance policy, a Florida appellate court has ruled. Imagine Insurance Co. v. The Florida Department of Financial Services, No. 1D07-6027 (Fla. App., 1st Dist.).

In a Dec. 16 order, the Florida Court of Appeals, First District, further ruled that the reinsurer, Imagine Insurance Co., is contractually entitled to recover a non-renewal charge from the receiver.

In June 2004, Imagine issued American Superior Insurance Co. a structured reinsurance contract under which Imagine agreed to indemnify American Superior for …