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The Collaborative Clearinghouse for Lawsuits and Other Claims Against ACE Group Insurance Companies

Fellow Insurer Sues ACE Unit Over Reinsurance Claims

September 18th, 2013 - A mutual insurance company from New York has sued Century Indemnity Co. in an effort to get it to pay more than $3 million it says is due under reinsurance claims.

Utica Insurance Co., of Utica, New York, sued the ACE Group unit as successor to CCI Insurance Co., which was a successor to Insurance Co. of North America.

In its suit, which was filed in U.S. District Court for the Northern District of New York, Utica said that it had in place two reinsurance agreements with INA - one dating to 1973 and the other to 1975.

Under the 1973 certificate, Utica said that it has billed $2,712,437 to Century, which it believes the ACE Unit is required to pay. It has billed Century another $715,000 as part of the 1975 certificates.

Utica said that it has provided all information requested by Century, including data on the underlying liability claims, Utica’s payouts, and billings submitted to Century. It said it also made that information available during an audit of its books that was conducted by Century.

Century has not advised Utica of any specific grounds upon which it is refusing to pay the claims, said the mutual. Utica has said that it cannot locate complete copies of the reinsurance certificates, but did not indicate that Century used that as a reason to withhold payment

Therefore, Utica said that Century is in breach of its obligations under terms of the reinsurance certificates.

In addition, Utica charged Century with violating its duty to deal fairly and in good faith with its client. The insurance company asked the court for a declaratory judgment against Century for $3,427,437, as well as a declaration that Century is obligated to pay any future billings from Utica.

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