Foreign Insurers Face Uncertainty Over State Arbitration Laws

Law360 (July 31, 2020, 9:52 PM EDT) -- A complicated question of whether state laws barring arbitration of insurance disputes can negate international insurance contracts with arbitration clauses has created a quietly percolating atmosphere of confusion among federal appeals courts in the U.S., exposing foreign insurers to potentially lengthy legal battles.

Arbitration clauses are a common feature of insurance contracts signed by foreign insurers seeking to avoid the expense and perceived uncertainty that comes with having to resolve a dispute with a policyholder in court — including a possible adverse jury verdict and subsequent years of resource-draining appeals. Arbitration, by contrast, is generally viewed as a more straightforward dispute...

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