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Mealey's Insurance Insolvency

  • May 09, 2025

    Recommendation To Remand Adopted In Hurricane Ida Dispute With Insolvent Insurer

    BATON ROUGE, La. — After review and because no objection was filed to a magistrate judge’s report, a Louisiana federal judge adopted the magistrate’s recommendation to remand to state court for lack of subject matter jurisdiction a bad faith suit filed against a now-insolvent homeowners insurer over its purported failure to pay for damages caused by Hurricane Ida.

  • May 09, 2025

    Magistrate Sets Conference Date In Life Policy Payout Breach Of Contract Suit

    CINCINNATI —  An Ohio federal magistrate judge set a settlement conference date for parties in a liquidating trustee’s breach of contract suit against an insurer for failure to pay the full amount owed on a life insurance policy.

  • May 08, 2025

    Sealing Request Gets OK In Contempt Bid In Fraud Suit Over Secured Loans

    NEW YORK — Without explanation, a New York federal judge granted a motion to seal certain documents connected to a contempt request that concerns a preliminary injunction (PI) order in litigation over fraud and racketeering allegations that involve the parent company of Bermuda reinsurer 777 Re Ltd.

  • May 07, 2025

    Utah Regulator Agrees To Mediation With Insurers He Wanted To Have Rehabilitated

    SALT LAKE CITY — The Utah Insurance Department has reported that litigation between it and Sentinel Security Life Insurance Co., Haymarket Insurance Co. and Jazz Reinsurance Co. has been paused pursuant to the parties’ agreement to participate in mediation.

  • May 06, 2025

    Policyholder’s Motion To Intervene Was Untimely, Life Insurer’s Rehabilitator Says

    WATERBURY, Conn. — The rehabilitator of life insurer PHL Variable Insurance Co. and the subsidiaries that reinsure its liabilities urged a Connecticut state court to deny as untimely a motion to intervene filed by two policyholders who say their policies are worth millions and want a moratorium order to be modified to pay death benefits on a pari passu basis.

  • May 05, 2025

    Louisiana Panel Upholds Judgment On Jury Verdict In Hurricane Ida Coverage Row

    GRETNA, La. — A Louisiana state appeals court affirmed a lower court’s rulings entering judgment on a jury verdict awarding $23,534.62 to homeowners and denying a judgment notwithstanding the verdict (JNOV) in a dispute with the Louisiana Insurance Guaranty Association (LIGA) over coverage for damages caused by Hurricane Ida, finding that because the jury’s decision to not award the total amount of damages claimed by the homeowners “is supported by the evidence,” the lower court did not abuse its discretion in denying a new trial.

  • May 02, 2025

    Judgment For Guaranty Association Affirmed In Florida Law Hurricane Coverage Row

    WEST PALM BEACH, Fla.  — A Florida appellate court affirmed a lower court’s ruling granting summary judgment for the Florida Insurance Guaranty Association (FIGA) and dismissing a suit as time-barred in a dispute over coverage for a condominium association’s purported damage caused by Hurricane Irma, finding that the lower court correctly applied the appropriate Florida statute to determine that the suit was time-barred because it was filed after the applicable five-year statute of limitations.

  • April 30, 2025

    Stay Granted In $1B Insurance Fraud Case Pending Sentencing In Related Cases

    RALEIGH, N.C. — A North Carolina federal judge granted a consent motion to stay in a suit accusing Insurance magnate Greg Lindberg and his co-defendant asset management companies and other parties of Racketeer Influenced and Corrupt Organizations Act violations related to their purported participation in a $1 billion scheme to defraud now-insolvent insurers once owned by Lindberg.

  • April 30, 2025

    Residents Sue State-Mandated Insurer ‘Of Last Resort’ Over Los Angeles Wildfires

    LOS ANGELES — California residents sued the California Fair Plan Association (CFPA) and its largest members in a state court seeking damages for the defendants’ alleged bad faith breach of their property insurance policies following the Los Angeles wildfires in January.

  • April 25, 2025

    Oral Argument Set In Challenge To Rehab Plan For Workers’ Comp Insurer

    SAN FRANCISCO — Oral argument is scheduled in the First District California Court of Appealin a workers’ compensation insurance carrier’s challenge to a nonconsensual rehabilitation plan that was approved as part of conservation proceedings brought by California’s insurance regulator and includes resolution of dozens of reinsurance participation agreement (RPA) lawsuits.

  • April 23, 2025

    Judge Adopts Report And Settlements, Dismisses Insurers In Asbestos Coverage Row

    BUFFALO, N.Y. — A New York federal judge adopted a magistrate judge’s combined report and recommendation to settle estates’ claims with insurers and dismiss the claims against them in four similar suits filed by the estates of people who died purportedly from asbestos exposure, seeking payment of judgments entered against an asbestos mine, finding no error in the magistrate judge’s report and recommendation.

  • April 23, 2025

    Reinsurer, Life Insurer Seek Approval Of $6.48M Liquidation In Delaware Court

    WILMINGTON, Del. — A stipulation filed in the Delaware Chancery Court between the receiver for a stock reinsurance company and a life insurer would provide for the distribution of $6.48 million and the liquidation of a reinsurance trust to resolve claims under a secured treaty.

  • April 23, 2025

    Policyholder Asks To Intervene, Contest Benefits Cap In Insurer Rehabilitation

    WATERBURY, Conn. — A corporate policyholder holding $18 million in death benefits from a life insurer in rehabilitation moved to intervene in a Connecticut state court action, seeking involvement in future proceedings and participation in discovery, arguing that a moratorium order capping payout at $300,000 per insured policy imposes a disproportionate financial burden and violates priority rules under state insurance law.

  • April 23, 2025

    Recommendation To Dismiss Guaranty Association Adopted In Hurricane Coverage Row

    LAFAYETTE, La. — In a homeowner’s hurricane coverage dispute, a Louisiana federal judge adopted a magistrate judge’s report and recommendation to dismiss the Louisiana Insurance Guaranty Association (LIGA) upon finding that the homeowner failed to show good cause for not timely serving LIGA as required under Federal Rules of Civil Procedure.

  • April 22, 2025

    Citing No Diversity, Judge Remands Hurricane Ida Coverage Dispute To State Court

    NEW ORLEANS — A Louisiana federal judge granted a homeowner’s motion to remand to state court a Hurricane Ida coverage dispute after the Louisiana Guaranty Association (LIGA) was added as a defendant, finding that due to the absence of complete diversity, “remand to state court is appropriate.”

  • April 17, 2025

    Plaintiffs Lack DUFTA Standing, Insurance Holding Company Says In Delaware Court

    WILMINGTON, Del. — Arguing that the plaintiffs in a putative class suit lack standing to bring a Delaware Uniform Fraudulent Transfer Act (DUFTA) claim, an insurance holding company and its affiliates seek summary judgment in the Delaware Chancery Court over an alleged scheme to strip capital from an insurance subsidiary on which many policyholders depend for long-term care (LTC) disability benefits.

  • April 16, 2025

    Discovery Hearing Canceled In Bad Faith Suit Upon Liquidation Of Insurer

    LAS VEGAS — In a docket-only minute order, a Nevada federal magistrate judge canceled a discovery hearing after previously issuing an order staying a bad faith suit against an insurer upon receiving notification that a Kansas state court entered a judgment of liquidation, finding the insurer insolvent.

  • April 15, 2025

    Stipulation Filed In Fraudulent Transfer Case After Insurer Liquidation Settlement

    TOPEKA, Kan. — After being advised that settlement agreements were approved by a Kansas state court, parties in a fraudulent transfer case in Kansas federal court involving the insolvent insurer filed a stipulation of dismissal.

  • April 15, 2025

    Bad Faith Suit: CFPA Systematically Failed To Investigate, Pay Wildfire Claims

    LOS ANGELES — Plaintiffs sued California Fair Plan Association (CFPA) and its “largest” members for breach of contract and bad faith in a California court, seeking compensation for their losses incurred by the January Los Angeles wildfires and to hold CFPA “accountable for its decade-long, systematic failure to properly investigate and pay wildfire claims.”

  • April 11, 2025

    Panel Affirms Judgment For Now-Insolvent Insurer In Water Damage Coverage Dispute

    MIAMI — A Florida appellate court affirmed a lower court’s ruling granting summary judgment to a now-insolvent insurer in a dispute with homeowners over coverage for plumbing-related water damage to their home, finding that the lower court correctly determined that the water damage was excluded from coverage under the homeowners’ policy.

  • April 09, 2025

    Magistrate Grants Wells Fargo’s Motion To Withhold Discovery In $300M Ponzi Suit

    MIAMI — A Florida federal magistrate judge granted in part Wells Fargo’s motion to withhold discovery in a putative class action alleging that Wells Fargo aided and abetted fraud in a “massive” Ponzi scheme purportedly orchestrated by owners of insurers, some of which are now in receivership, resulting in elderly investor victims losing more than $300 million after scheme operators sold them promissory notes secured by collateral in stranger-oriented life insurance policies (STOLIs).

  • April 08, 2025

    Florida Panel Affirms Dismissal Of PIP Suit Against Guaranty Association

    MIAMI — A Florida state appellate court affirmed a lower court’s dismissal of a suit seeking payment of personal injury protection (PIP) benefits from the Florida Insurance Guaranty Association (FIGA) for an insured’s injuries sustained in an auto accident after FIGA allegedly refused to pay the claim following the PIP insurer’s insolvency, finding that because the suit was not filed against the insurer before its insolvency, dismissal “was proper” and barred by the statute of limitations.

  • April 03, 2025

    U.K. Reinsurer Posts $403K Bond In Asbestos Claims Reinsurance Contract Dispute

    NEW YORK — A U.K.-based reinsurer posted a $403,748.42 bond in a federal court in New York, the amount sought by the assignee of the liquidator of an insolvent insurer in a reinsurance contract dispute relating to ongoing asbestos claims.

  • April 03, 2025

    Citing Settlement Negotiations, Judge Denies Motions In D&O Coverage Row

    INDIANAPOLIS — Noting that the “parties report they are in the process of finalizing a formal settlement agreement,” an Indiana federal judge denied without prejudice a motion for oral argument and the parties’ cross-motions for summary judgment in a suit filed by an insurer now in rehabilitation seeking a declaration that specified directors and officers (D&O) policies apply to cover claims in underlying litigation.

  • April 02, 2025

    Petition Distributed In High Court In Row Over Status Of Underwriting Association

    WASHINGTON, D.C. — The U.S. Supreme Court on April 1 distributed for conference a petition filed by the state-created Pennsylvania Professional Liability Joint Underwriting Association (JUA), which provides coverage to health care providers, including those previously insured by insurers in liquidation, seeking review of a Third Circuit U.S. Court of Appeals ruling holding that the JUA did not have constitutional rights to challenge the constitutionality of  Pennsylvania laws due to JUA’s nature as a public entity instead of a private one.