Policyholders Have No Cause of Action Against Reinsurer

HARTFORD, Conn. - No probable cause exists for policyholders to sue a reinsurer for its refusal to pay extended warranty claims in the wake of an insurer's insolvency because the facts do not show that the reinsurance coverage was extended beyond one year, a Connecticut appeals court has affirmed. H&L Chevrolet v. Berkley Insurance Co., No. AC 27670 (Conn. Ct. App.).

In a Sept. 23 opinion, the Connecticut Court of Appeals further affirmed that the reinsurer, Berkley Insurance Co., had no legal duty to notify the policyholders that it did not plan to renew the reinsurance policy.

H&L Chevrolet sold …