New York Superintendent of Insurance, Eric Dinallo, recently revealed that the New York State Insurance Department is working “avidly” to alleviate the capital crisis at bond insurer FGIC. FGIC was the subject of ratings downgrades by both Fitch Ratings and S&P earlier this year.
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UK: Regulatory: The Financial Service Authority (FSA) Calls for Increased Co-Operation in Europe
By Troutman Pepper Locke on
The FSA has restated the UKs support for the creation of a single market in financial services in Europe, and has called for further development of the existing arrangements for regulatory cooperation among national regulators. The recommendation was contained in the latest edition of what the FSA described as its ‘new look’ International Regulatory Outlook (IRO).
Fitch Downgrades MBIA to AA
By Troutman Pepper Locke on
Last week, Fitch Ratings downgraded MBIA Insurance Corp. and its subsidiaries from AAA to AA, stating that the bond insurer’s pro-forma claims paying resources at year-end 2007 now fall below Fitch’s AAA capital targets by $3.4 to $3.8bn. Instead, Fitch concluded that MBIA’s pro-forma claims paying resources fall squarely within its standards for AA capital.
UK House of Lords’ Ruling Assists Foreign Liquidators
By Troutman Pepper Locke on
In a closely-watched case stemming from the demise of the Australian HIH insurance group, the UK House of Lords has ruled in McGrath & Anor & Others v Riddell and Others [2008] UKHL 21 that the English assets of four companies in that group, which are in liquidation in Australia and in ancillary insolvency proceedings in England, must be remitted to Australia for distribution under Australian insolvency law.
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European Court of Justice Considers the Validity of Flemish Legislation Limiting Eligibility to a Care Insurance Scheme
By Troutman Pepper Locke on
Posted in European Union, Healthcare
In Government of the French Community, and Walloon Government v Flemish Government Case C-212/06, ECJ (Grand Chamber), the European Court of Justice (ECJ) determined that Flemish legislation limiting eligibility to a care insurance scheme was contrary to European provisions concerning the right to freedom of movement within the European Community (EC) in so far as the care insurance scheme included a residence requirement that excluded persons who worked in the Flemish region or in the bilingual Brussels-Capital, but who resided in another part of the national territory (ie the French or German speaking region).
The English Court of Appeal Construes the Meaning of a Clause for Joint Insurance in a Construction Contract
By Troutman Pepper Locke on
Posted in Coverage & Claims, United Kingdom
In Tyco Fire & Integrated Solutions (UK) Ltd v Rolls-Royce Motor Cars Ltd [2008] EWCA Civ 286, Tyco had negligently caused damage to a Rolls-Royce plant during the course of constructing a sprinkler system. Tyco admitted negligence but claimed that it was not liable for the damage because Rolls-Royce was obliged, by virtue of a provision in the construction contract, to take out joint insurance indemnifying the parties in respect of Specified Perils, which included the said damage.
Kentucky Federal Court: Bad Faith Discovery Not Limited To Pre-Litigation Conduct
By Troutman Pepper Locke on
The Federal District Court for the Western District of Kentucky recently denied a defendant insurer’s request to limit discovery in a bad-faith case to its pre-litigation conduct and to not include conduct post-commencement of litigation.
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New Jersey Supreme Court Rules That Jury May Not Consider General Deterrence When Setting Amounts of Punitive Damages Awards
The Supreme Court of New Jersey recently held that the New Jersey Punitive Damages Act allows punitive damages to be entered for the purposes of punishing and deterring only a specific wrongdoer, not for general deterrence.
Insurance Insolvencies in the United States Reach a 10-Year Low
A recent report by Standard & Poor’s (“S&P”) noted that the number of U.S. insurers placed under regulatory supervision in 2007 was the lowest in a decade. The report attributes a decrease in insolvencies among property casualty insurers to, among other things, a mild hurricane season combined with better underwriting and an improved premium rate environment. …
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Resolution Issued by Ukrainian Court Rejects Enforcement of Arbitration Awards Under New York Convention
By Troutman Pepper Locke on
A member of the U.S.-Ukraine Business Council recently predicted that a resolution issued by the Ukrainian High Commercial Court may lead to that country’s secession from the U.N. Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “Convention”).