Retrocessionaire Has Burden of Establishing Indemnity Obligation, Judge Rules

TRENTON, N.J. - As a retrocessionaire, Tower Insurance Co. has the burden of establishing the extent of its obligation to indemnify Munich Reinsurance America Inc. for certain lead paint claims under a 1998 retrocessional agreement, a New Jersey federal judge has ruled. Munich Reinsurance America Inc. v. Tower Insurance Company of New York, No. 09-2598 (D. N.J.).

On July 17, Judge Freda L. Wolfson of the U.S. District Court for the District of New Jersey held that in accordance with the plain language of the agreement, along with the applicable canons of insurance contract construction, Tower, as retrocessionaire, bears the …