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PRACTICE AREAS
Reinsurance
The number of disagreements between ceding insurers, assuming reinsurers, underwriting agencies, and claims managers appears to be growing each year. Those involved in the reinsurance industry are confronted with an ever-increasing gamut of issues, ranging from the almost routine disputes over the allocation of losses to unusual industry problems arising from crises of the moment such as workers compensation carve-out business, life annuity contracts or credit and mortgage insurance and reinsurance. The matters may vary in scope from a single claim for hundreds of thousands of dollars to company-threatening disputes worth hundreds of millions of dollars. In addition to complex substantive issues, reinsurance disputes frequently involve procedural skirmishes over the proper forum for resolution of the dispute, disagreements over the appropriate composition of the arbitration panel, and important contests over pre-hearing security.
A group of our trial lawyers have dedicated their practices to reinsurance-related matters. To provide unsurpassed service, we have immersed ourselves in the intricacies of reinsurance custom and practice and the commercial relationships upon which participants in the industry depend. As a consequence of long and varied experience for major U.S. and European clients, the lawyers at Butler Rubin are in a unique position to advise clients and guide them through a difficult environment.
In 2008, Butler Rubin was again named the #1 firm (tie) in Illinois for Insurance: Reinsurance Litigation by Chambers USA. Additionally, four Butler Rubin reinsurance partners were individually ranked among the top reinsurance lawyers in Illinois, including James Rubin (#1 tie), Robert Hermes (#2 tie), Ira Belcove (#4 tie) and Catherine Isely (#4 tie). Chambers said, “the premier reinsurance firm in the city,” according to many in the market, Butler Rubin is highly acclaimed for its quality insurance practice. “Knowledge, responsiveness and a drive for results” are qualities frequently attributed to this “classy team.”
In 2004, Butler Rubin created Women in ReinsuranceTM (WIR) to discuss how the reinsurance industry was evolving and how women could play a dynamic role in the future of the field. WIR regularly sponsors events of interest to professional women in the reinsurance industry and fosters networking and information sharing.
Arbitration and Litigation Services:
For more than 25 years Butler Rubin's attorneys have been involved in litigating and arbitrating reinsurance disputes. The wide scope of issues on which Butler Rubin has represented its clients can be measured by looking at just a few of the firm's recent successes:
- Persuaded a Connecticut trial court that XL Specialty had tortiously interfered with Carvill America’s right to collect brokerage from reinsurers;
- Successfully argued that the cession of claims involving contamination at over 100 separate sites constituted a single occurrence;
- Successfully argued that provisions of a finite reinsurance contract worth hundreds of millions of dollars had to be interpreted consistent with its pricing; and
- Persuaded the U.S. Court of Appeals for the Seventh Circuit to reverse a district court judge's vacatur of an arbitration award involving alleged arbitrator bias.
More generally, our experience in litigating and arbitrating reinsurance disputes in recent years has included the following issues:
Arbitration Issues
- Enforceability and scope of arbitration provisions.
- Selection, qualification, and disqualification of arbitrators.
- Propriety of pre-hearing security.
- Access to records, reinsurance audits, and other discovery issues.
- Confirmation of arbitration awards.
Underwriting Issues
- Misrepresentations and omissions.
- Utmost good faith.
- General underwriting administration.
- Individual underwriting decisions.
- Warranties and exclusions.
- Contract interpretation.
- Reinsurance spirals.
Claims and Allocation Issues
- Propriety of different reserving practices and actuarial methods.
- Late notice of claims.
- Recoverability and allocation of asbestos, environmental, and toxic losses, including "non-products" asbestos claims.
- Number of occurrences in property and casualty claims.
- Recoverability of declaratory judgment expenses, expenses in excess of indemnity limits, pre-judgment interest, and extra-contractual losses.
- September 11th issues.
- Exhaustion of underlying limits.
Finite Reinsurance Issues
- Placement and pricing of finite reinsurance contracts.
- Interpretation of provisions commonly found in finite reinsurance contracts, including sublimits, special termination clauses, reset clauses, and access to records clauses.
- Attachment of finite reinsurance coverage at selected loss ratios.
Agency Issues
- Authority of various types of agents and the propriety of their actions.
- Termination of insurance and reinsurance agencies.
Insolvency Issues
- Ownership of common account excess of loss recoveries.
- Availability of set-offs.
- Interpretation and enforceability of cut-through clauses.
- Ownership of letters of credit and trust instruments.
- Creditor standing to pursue causes of action against third parties.
Counseling Services
In addition to trying and arguing cases – in courtrooms, before arbitration panels, and in the courts of appeal – Butler Rubin provides business services to our clients, including preparation of contracts, trust documents, and commutation agreements, advising on asset transfers, disclosures, and notices to reinsurers, and providing counseling regarding other non-litigation aspects of reinsurance relationships.
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