Reinsurers Not Obligated to Cover Madoff Fraud, N.J. Appeals Court Affirms

TRENTON, N.J. - Two reinsurers have no obligation to cover losses sustained by an investment company as a result of Bernie Madoff's investment fraud, a New Jersey appellate court has affirmed, ruling that the loss is excluded by the underlying property insurance policies. Bleznak Black LLC v. Allied World National Assurance Co., et al., No. A-6107-09T2 (N.J. App. Div.).

On April 20, the New Jersey Superior Court, Appellate Division, ruled that Madoff stole "money" and "securities," as defined by the policies' exclusions.

Bleznak Black LLC, an estate planning investment company, sued its 2008-2009 insurers in the Camden County (N.J.) Superior …