N.Y. Judge Allows Transatlantic’s Affirmative Defenses to Stand in Loss Portfolio Transfer Dispute

NEW YORK — A New York judge has denied AIG insurers’ efforts to renew their motion to dismiss certain affirmative defenses asserted by Transatlantic Reinsurance Co. (TRC) in a dispute over whether the AIG insurers’ 2011 transfer of asbestos losses to other insurers breached facultative reinsurance certificates issued by TRC.

On June 18, Judge O. Peter Sherwood of the New York County Supreme Court ruled that questions exist as to whether the transfer constituted permissible “treaty” reinsurance, which was allowable under the certificates.

Granite State Insurance Co. and other AIG insurers issued three excess liability policies to Transamerica Corp., which …