Self-Insured Fund Says Bad Faith Claim Against Reinsurers is Proper

MONTGOMERY, Ala. — The Alabama Self Insured Workers Compensation Fund told a federal judge that its lawsuit seeking $1.2 million from General Reinsurance Corp. (GRC) and Genesis Insurance Co. should proceed because there is no binding case law holding that a self-insurer cannot sue its own insurer for bad faith.

In an Oct. 10 opposition filed before Judge Myron H. Thompson of the U.S. District Court for the Middle District of Alabama, the Fund contends that the contract at issue one of insurance, not reinsurance, therefore its bad faith claim is permitted under Alabama law.

Defendants’ reliance upon the Middle …