Ala. Workers’ Compensation Fund Sues Reinsurer for Contribution Toward $50,000 Payout

MONTGOMERY, Ala. — An Alabama self-insured fund has sued General Reinsurance Corp., demanding contribution toward $50,000 it paid to resolve a workers’ compensation claim, arguing that the reinsurer has attempted to conduct an after-the-fact audit which is not permitted under the reinsurance contract.

In a Dec. 16 complaint in the U.S. District Court for the Middle District of Alabama, the Alabama Self Insured Workers Compensation Fund says GRE has acted in bad faith by delaying payment of the reinsurance claim and making unreasonable demands for supporting documentation.

According to the complaint, in January 2003, GRC issued the Fund a one-year …