Reinsurer May Not Deny Coverage for Late Notice Absent Prejudice, Judge Rules

PHILADELPHIA - Global Reinsurance Co. may not deny reinsurance coverage to Pacific Employers Insurance Co. for underlying asbestos claims on the basis of late notice absent a showing of prejudice, a Pennsylvania federal judge has ruled. Pacific Employers Insurance Co. v. Global Reinsurance Corporation of America, No. 09-6055 (E.D. Pa.).

Judge Robert F. Kelly of the U.S. District Court for the Eastern District of Pennsylvania ruled that the notice-prejudice rule applies to reinsurers and that Global failed to introduce evidence that it was prejudiced as a result of PEIC's late notice.

PEIC entered into a facultative contract with Global's predecessor, …