Until recently, foreign insurers with head offices located in a ‘tax haven’ (broadly, countries that levy less than 20% income tax), were not permitted to register entities in Argentina. The Argentine Income Tax law contained a so-called ‘black list’ of jurisdictions the government considered a ‘tax haven’. …
Read More Argentina Changes Rules on the Registration of Entities with Head Offices in Black-Listed ‘Tax Havens’

In a 2-1 decision released on February 20, the U.S. Court of Appeals for the Fourth Circuit reversed the district court below and declared that the term “direct contributing properties” was unambiguous in the context of a policy that provided contingent business interruption coverage. Accordingly, the court found that the insured was not entitled to coverage when its production facility was knocked offline for several months following an explosion at a natural gas producer’s facility. …
Read More Fourth Circuit Declares “Direct Contributing Properties” Unambiguous In Context of CBI Coverage

In Impact Funding Solutions Limited (Impact) v. Barrington Support Services Limited (Barrington) v. AIG Europe Limited (AIG) (third party) [2013] EWHC 4005 (QB), the Court had previously ordered that Barrington (a company providing legal services) pay Impact (a third party litigation funder) £581,353.80 in damages for Barrington’s breaches of a Funding Agreement between Barrington and Impact. Under the Funding Agreement, Impact would provide a loan to Barrington’s clients to fund personal injury claims. …
Read More UK: Case Illustrates Need for Third Party (Rights Against Insurers) Act 2010 to be Enacted

The Southern District of New York has issued an interesting opinion for allocation disputes decided under Massachusetts law. The case, which concerns long-tail environmental damage, is The Narragansett Electric Co. v. American Home Assurance Co., No. 11-8299 (S.D.N.Y., Feb. 18, 2014). A copy of the opinion is available here. …
Read More New York Federal Court, Applying Massachusetts Law, Holds that Defense Costs Should be Allocated by the Joint and Several Method Rather than the Pro Rata Method

The Financial Conduct Authority (FCA) has fined HomeServe Membership Limited (HomeServe) £30,647,400 for breaching several of the FCA’s Principles of Business. The FCA states its final notice that HomeServe’s failings were “serious, systemic and long running”. …
Read More FCA Imposes Record Fine for HomeServe’s Widespread Breaches of FCA’s Principles of Business

Vermont Governor Peter Shumlin has signed H. 198, titled the Legacy Insurance Management Act (“LIMA”), in an effort to attract new domestic insurance companies dedicated to run-off business in Vermont. LIMA allows for the formation of Vermont-domiciled insurance companies whose sole purpose is to acquire closed blocks of P&C commercial insurance and reinsurance business from non-admitted companies. …
Read More Vermont Enacts “Legacy Insurance Management Act” for Commercial Run-Off Business

New York’s highest court has reversed itself on an important duty to defend opinion. In K2 Inv. Group, et al. v. Am. Guar. & Liab. Ins. Co., (Feb. 18, 2014), available here, the Court of Appeals held that an insurer which breaches its duty to defend does not lose its right to rely on policy exclusions as a defense to indemnity. …
Read More New York’s Highest Court Holds that Breach of Duty to Defend does not Prevent Insurer from Relying on Policy Exclusions to Dispute Duty to Indemnify

The UK’s Financial Conduct Authority (FCA) has indicated that it is likely to exercise its competition functions in the insurance sector in the next few months, including by examining retirement annuities and insurance add-ons.
Read More UK: Financial Conduct Authority Increases Scrutiny of the Insurance Sector