A federal district court in Washington handed Validus Reinsurance a major win on Wednesday, declaring that the IRS has no authority to assess excise tax on retrocessions. The decision in Validus Reinsurance, Ltd. v. United States of America, No. 13-0109 (D.D.C. Feb. 5, 2014), is available here. …
Read More Validus Wins Round One: Retrocessions Not Taxable Under 26 USC § 4371(3)

As part of their ongoing law reform project, the Law Commission and Scottish Law Commission (the Commissions) have published a number of draft clauses relating to the Insurance Contracts Bill as part of a limited consultation. …
Read More UK: Law Commissions Publish Draft Clauses to the Insurance Contracts Bill

This past Friday, the Texas Supreme Court gave general liability insurers pointed guidance about what constitutes an “assumption of liability” for purposes of a contractual liability exclusion. …
Read More Texas High Court Rules That Contractor Does Not “Assume Liability” When Agreeing To Perform Work In Good & Workmanlike Manner

The British Insurance Brokers’ Association (BIBA) has launched its 2014 Manifesto (available here) in UK Parliament. BIBA addresses its campaigning issues in three ways: delivering for consumers; businesses; and the insurance industry. …
Read More UK: BIBA Manifesto 2014 Highlights Cost of Brokers’ Regulation in the UK

Illinois law permits rescission of an insurance policy if, in negotiating for the policy, the insured made an innocent, but material, misrepresentation. …
Read More An Illinois Appellate Court Again Refuses to Recognize that Innocence Does Not Bar Rescission of an Insurance Policy

On December 18, 2013, the National Association of Insurance Commissioners (NAIC) approved four jurisdictions as “Conditional Qualified Jurisdictions,” meeting its year-end goal for expedited review of certain jurisdictions. The four jurisdictions are Bermuda, Germany, Switzerland and the United Kingdom.
Read More NAIC: Bermuda, Germany, Switzerland and UK Now Qualified for Reduced Collateral Requirements

While interpreting a policy governed by Illinois law, the Seventh Circuit found ambiguity based on two “plausible” interpretations and found coverage, a finding based on language that appears to have been construed in isolation and without regard to the purpose or pricing of the policy. That case was National Casualty Co. v. White Mountains Reinsurance Co., no. 11-3158 (7th Cir. Oct. 30, 2013).
Read More Based on a Doubtful “Plausible” Reading of an Insurance Policy, the Seventh Circuit Finds Coverage

On 12 December 2013, the European Insurance and Occupational Pensions Authority (EIOPA) published its second Half-Year Financial Stability Report for 2013 (available here). The risk environment described in the second Half-Year report is broadly the same as the environment described in the first Half-Year report, published in July.
Read More EU: EIOPA publishes second Half-Yearly Financial Stability Report for 2013; comprehensive stress tests on the way

The Financial Conduct Authority (FCA) has fined Porta Verde Financial Services Limited (Porta Verde) £25,000 for the serious mis-selling of insurance products by two of its appointed representatives (ARs).
Read More FCA fines Porta Verde £25,000, reminding firms to keep a close watch on their appointed representatives