JURY AWARDS STONEBRIDGE CASUALTY $5.8 MILLION ON REINSURANCE CLAIM
A final judgment was recently entered on a jury verdict awarding $5.8 million to Stonebridge Casualty Insurance Company. The case involved a reinsurer’s failure to pay reinsurance claims arising out of an automobile tire loyalty rewards program insured by Stonebridge. The reinsurer was a motor club that had entered into a contractual arrangement with certain Lloyd’s syndicates under which the motor club agreed to be financially responsible for reinsurance claims.
Under the insured program, automobile dealerships offered their customers a reward certificate entitling the customer to two free sets of tires if they returned to the dealership for all of the manufacturer’s recommended service. Stonebridge insured the program and obtained reinsurance coverage in the event that claims exceeded $46 per certificate. After the reinsurance threshold was exceeded and Stonebridge filed reinsurance claims, the motor club and Lloyd’s contended that the tire claims were invalid and sued Stonebridge for a declaration that they were not liable. Stonebridge counterclaimed, and after seven days of trial, the jury returned a verdict in favor of Stonebridge, awarding the full amount of damages sought in the amount of $5.8 million. Stonebridge has also filed a motion seeking additional prejudgment interest of $813,226. Stonebridge Casualty Ins. Co. v. Nation Motor Club, Inc., Case No. 9:10 cv 81157 KLR (USDC S.D. Fla. Mar. 24, 2014).
This post written by Michael Wolgin.
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