Trader Accuses Insurer of Bad Faith for Refusing to Cover Generator Destroyed by Superstorm Sandy

NEW YORK — A financial trading firm in lower Manhattan has sued Aspen American Insurance Co. for refusing to cover more than $2 million in losses suffered when Superstorm Sandy flooded a basement of the firm’s office building.

Jane Street Holding filed the complaint April 8 in U.S. District Court for the Southern District of New York, alleging that Aspen has acted in bad faith by denying its coverage obligation to pay in excess of $50,000 for damage to a backup generator located in the basement.

According to the lawsuit, the generator was destroyed during Superstorm Sandy, which caused extensive …