Aon PLC has settled a lawsuit over a tornado loss suffered by Pilkington North America Inc. in which a policy provision limited the glass maker’s coverage to $15 million, a fraction of the damage estimate.
According to Aon’s 10Q, filed with the US Securities and Exchange Commission on Friday, Pilkington sought between $45 million and $85 million in property and business interruption damages from its insurer or Aon, its broker. The insurer was Mitsui Sumitomo Insurance Co. of America Inc.
In its 10Q, Aon noted that its operating expenses increased in the second quarter due in part to “a $58 million charge related to certain legal settlements reached.” Aon declined to comment on the lawsuit.
According to the original costume, Pilkington North America Inc. v. Mitsui Sumitomo Insurance Co. of America Inc. et al.Toledo, Ohio-based Pilkington alleged, among other things, that Aon failed to change a 2016 policy revision that changed a named windstorm sublimit to a U.S. windstorm limit.
The entire policy had a limit of $320 million, but after Pilkington’s plant in Ottawa, Illinois, was destroyed by a tornado in February 2017, Mitsui paid only $15 million, according to the lawsuit.
According to a court filing on June 16, the case was settled without any costs being awarded to either party.
A third-party complaint in the case filed by Mitsui against Aon was dismissed in 2021.