Policyholder Sues Applied Underwriters, Captive Reinsurer for $2.8 Million

OMAHA, Neb. — A workers’ compensation policyholder has sued Applied Underwriters Inc. (AUI) and its captive reinsurer and insurer subsidiary in Nebraska federal court, accusing them of breaching a reinsurance participation agreement (RPA) by refusing to reimburse it approximately $2.8 million.

In a Nov. 5 complaint filed in the U.S. District Court for the District of Nebraska, Certified Moving & Storage Company LLC further alleges defendants fraudulently induced it to enter the RPA and buy the workers’ compensation policy.

Applied sold the “EquityComp” workers’ compensation insurance program, which included policies underwritten by Continental Indemnity Co. and an RPA. The RPA …