Commutation Included All Reinsurance Certificates, Court Affirms

CHICAGO - A commutation agreement between Old Republic Insurance Co. and Ace Property and Casualty Insurance Co.'s predecessor clearly encompasses all reinsurance contracts between the parties, thereby extinguishing the parties' obligations under those contracts, an Illinois appellate court has affirmed. Old Republic Insurance Co. v. Ace Property and Casualty Insurance Co., No. 1-07-2668 (Ill. App., 1st Dist.).

In a March 24 opinion, the Illinois Court of Appeals, 1st District, upheld a stay of an arbitration in which Ace sought payment from Old Republic under a 1982 reinsurance certificate.

In late 1982, Old Republic issued a casualty facultative certificate to Ace's …