قالب وردپرس درنا توس
Home / Insurance / Allied World wins largely in litigation with the Brown & Brown entity

Allied World wins largely in litigation with the Brown & Brown entity



A federal appellate court largely upheld a lower court ruling in favor of Allied World Assurance Co. Holdings Ltd. Wednesday in disputes with a claims handling unit within Brown & Brown Inc. in a case involving QBE Insurance Group.

The Allied World Unit Allied World Surplus Lines Insurance Co., then known as Darwin Select Insurance Co., issued a professional liability policy to the Brown & Brown unit American Claims Management Inc., based in Carlsbad, California, in October 2010, according to the complaint. in American Claims Management, Inc. v. Allied World Surplus Lines Insurance Co. (F / K / A Darwin Select Insurance Co.)filed in the 2018 U.S. District Court in San Diego.

ACM acted as a third-party administrator for QBE and handled, among other things, vehicle policies. A QBE policyholder was sued after a car accident that injured family members and ACM handled the claim.

The policyholder was jailed for his role in causing the accident, and in June 201

5, the family won a $ 22 million jury verdict in that case. QBE eventually settled with the family for $ 15 million, and then filed an arbitration claim against ACM in connection with its handling of the case and demanded a refund for the amount they had paid.

In July 2017, the Arbitration Board granted QBE its entire claim for damages – a total of $ 18.5 million. In January 2018, Allied World partially funded the arbitration award, but approximately $ 4.9 million of it remained unfunded and $ 1.1 million in fees and expenses remained unpaid, according to the complaint.

The district court ruled in Allied World’s favor and was largely upheld by an appellate court with three judges. The district court correctly concluded that the insurance’s exclusion from non-life insurance services excluded coverage, the appellate court’s decision said.

This exception presupposed that coverage was not available in matters involving lack of good faith or fair handling if there was a “recognition, final judgment or a finding” of an accusation of bad faith against ACM, it states.

The verdict said that a discovery decision issued by a state court in the case “constitutes a” finding “of an allegation of bad faith against ACM, and that Allied World is entitled to a refund of the $ 4.4 million it paid ACM under a reservation of rights in connection with the arbitration award.

The Court of Appeal also stated that Allied World had not breached its obligation to defend the ACM and that the lower court “correctly concluded that Allied World had complied with its obligation to engage a competent representative.”

The panel reversed the district court’s assessment that Dishonest Act Exclusion blocked coverage, stating that there was no acknowledgment that ACM had engaged in “any dishonest or fraudulent act or omission.”

Because of this, Allied is not entitled to compensation of $ 605,569 in defense costs, the decision said.

Lawyers in the case had no comments or did not respond to a request for comment.


Source link