Munich Re Prevails in Ala. Reinsurance Retention Dispute

MONTGOMERY, Ala. — An Alabama federal judge has sided with Munich Reinsurance America Inc. in a dispute over how much it owed a cedent for costs it incurred in defending a lawsuit filed against an insured municipality, ruling that Munich Re properly deducted two $350,000 retentions from the sum it paid.

In a May 23 order, Judge Myron H. Thompson of the U.S. District Court for the Middle District of Alabama rejected Alabama Municipal Insurance Corp. (AMIC)’s argument the two wrongful acts at issue in the underlying action constituted a single wrongful act under the reinsured policy and thus only …