A federal court in New Jersey recently held that the construction of an ambiguous policy term is not a matter suitable for judgment on the pleadings, thus denying AIG from avoiding coverage for a $67 million antitrust settlement. Rather, the only way to establish the meaning of an ambiguous term, the court explained, is to ascertain the intent of the parties, which requires “meaningful discovery.”

Continue Reading No Easy Out For AIG in $67 Million Antitrust Coverage Suit

A New York trial court held last week in American Home Assurance Co. v. The Port Authority of N.Y. and N.J., Index No. 651096/2012 (Sup. Ct. N.Y. Nov. 29, 2017) (Bransten, J.) that an insurance policy issued in 1966, to insure the construction of the World Trade Center, continues to provide insurance coverage over modern-day asbestos claims, with each claim constituting an individual occurrence.

Continue Reading New York Court Finds 51-Year-Old AIG Policy Still Covers World Trade Center Asbestos Injury Claims

In an article appearing in Law360, Hunton & Williams insurance partner, Michael Levine, weighs in on Office Depot’s pending Ninth Circuit appeal of a district court ruling that Office Depot is not entitled to coverage for a California False Claims Act case alleging that the office supply chain overbilled public agency customers.  The decision is premised on a finding that California Insurance Code Section 533 — which precludes coverage for a policyholder’s willful acts — applies to the entire underlying CFCA action, including allegations of reckless and negligent conduct.  But as Levine points out, the district court made the “fundamental error” of presuming that Office Depot had actually been found liable for a violation of the CFCA, when it had not.  Section 533 requires “more than the mere allegation” of a willful act by a policyholder, he said.  Levine goes on to explain the danger in affirming such an erroneous ruling is that “it creates a dilemma for policyholders, because even the mere allegation of a CFCA violation would be barred from coverage [even though n]othing in Section 533 suggests it was intended to have such a broad preclusive effect.”

In prior posts (here and here), we have highlighted some potential coverage concerns for losses arising out of the use of blockchain technology. However, as previously reported, Blockchain technology’s relevance to insurance is not limited to coverage for losses. In fact, earlier this week, the Blockchain Insurance Industry Initiative known as B3i expanded its membership to include heavyweight insurance companies like Chubb, AIG, and Gen Re as well as notable insurance and reinsurance brokers like Marsh, Guy Carpenter, Willis Re, and JLT Re.

Continue Reading Blockchain Insurance Industry Initiative (B3i) Grows

The Ninth Circuit in Teleflex Medical Incorporated v. National Union Fire Insurance Company of Pittsburgh PA, No. 14-56366 (9th Cir. Mar. 21, 2017) affirmed a jury verdict finding that AIG must pay $3.75 million in damages plus attorneys’ fees to cover LMA North America, Inc.’s (“LMA’s”) settlement with its competitor over allegedly disparaging advertisements that characterized a competitor’s products as unsafe.

Continue Reading “Think Hard Before Saying No”: Ninth Circuit Disparagement Coverage Ruling Gives Policyholders A Lifeline In Settlement Negotiations Involving Excess Insurers

On March 31 and April 15, we wrote blog posts (which can be accessed here and here) about a D.C. federal judge’s decision to rescind MetLife’s systematically important financial institution (SIFI) status. On October 24, a D.C. Circuit three-judge panel heard oral argument of the appeal of that decision. The federal government advocated to reinstate MetLife’s “too big to fail” designation by arguing that regulators were not required to prove the insurance giant was likely to collapse before imposing enhanced federal oversight. Conversely, attorneys for MetLife argued that the Financial Stability Oversight Council (FSOC) acted arbitrarily by not partaking in any threshold analysis of how MetLife would be vulnerable to a financial collapse.

Continue Reading Metlife May Not Be “Too Big To Fail,” But Is It “Too Big To Handle” For State Insurance Regulators?

Insurance-giant American International Group (AIG) announced that it will be the first insurer to offer standalone primary coverage for property damage, bodily injury, business interruption, and product liability that result from cyberattacks and other cyber-related risks. According to AIG, “Cyber is a peril [that] can no longer be considered a risk covered by traditional network security insurance product[s].” The new AIG product, known as CyberEdge Plus, is intended to offer broader and clearer coverage for harms that had previously raised issues with insurers over the scope of available coverage. AIG explains its new coverage as follow:


AIG is offering its new coverage with limits of up to $100 million. The new coverage should be considered by policyholders looking to further mitigate their potential cyber exposure. It is important for policyholders to be aware, however, that the new AIG product, like any new insurance product, is yet to be tested in the courts, and challenges as to the scope of its coverage as well as the scope of its conditions and limitations are certain to follow. It is important, therefore, that policyholders continue to seek the advice of experienced coverage lawyers when considering this or any new insurance product.

Yesterday, a federal judge in the District of Columbia rescinded a regulatory order designating MetLife as a systemically important financial institution (“SIFI”). In December 2014, MetLife joined AIG and Prudential as the only insurance companies designated as SIFIs – a designation that subjected the insurers to additional regulation by the Federal Reserve and additional capital requirements. Unlike AIG and Prudential, MetLife took its challenge to the federal courts. And yesterday the court rewarded MetLife’s persistence.

The court released only a two-page summary order rescinding the SIFI designation and sealed its opinion, which likely contains the reasoning behind the court’s decision. The parties have until April 6 to identify proposed redactions to the opinion, after which the court presumably will release the opinion to the public. Hunton & Williams LLP will update this blog when the opinion is released.


On February 11, 2016, New Jersey’s highest court held that National Union Fire Insurance Co. of Pittsburgh, Pennsylvania, (“National Union”) could refuse coverage for Templo Fuente De Vida Corp. and Fuente Properties Inc.’s settlement with policyholder First Independent Financial Group under a “claims-made” directors and officers policy because First Independent did not provide notice “as soon as practicable.”

Continue Reading New Jersey Supreme Court Decision Reminds Policyholders To Make Timely Notice of Claims