TIG Not Required to Show Prejudice Before Denying Reinsurance Claim, 2nd Cir. Affirms

NEW YORK – TIG Insurance Co. was not required to prove it was prejudiced by AIU Insurance Co.’s untimely notice of its settlement of asbestos claims before denying AIU’s $12.3 million reinsurance claim, a federal appeals court has affirmed.

On Aug. 27, the 2nd Circuit U.S. Court of Appeals agreed with the trial court that Illinois law governs the certificates because they were entered into in Illinois and the expected place of AIU’s performance was Illinois. The appellate court further found AIU’s untimely notice was inexcusable under Illinois law, therefore TIG’s denial of the reinsurance claim was justified.

Since the …