Reinsurer Sued over Alleged Failure to Cover Silica Settlement

HOUSTON - An insurance company that paid $800,000 to a retailer of sandblasting equipment for a settlement it entered into with silica claimants has sued its reinsurer, claiming that it refused to cover about one-third of the agreement. Fairmont Specialty Insurance Co. v. Swiss Reinsurance America Corp., No. 07-2036 (S.D. Texas).

The lawsuit, filed June 19 in U.S. District Court for the Southern District of Texas, accuses Swiss Reinsurance America Corp. of failing to honor contractual obligations owed to Fairmont Specialty Insurance Company to cover more than $250,000 it owes the insurer for the settlement.

According to Fairmont, the settlement …