Miami entrepreneur Aaron Hirschhorn died in a ship collision accident in Biscayne Bay. His widow, Karen Nissim, received $66 million in arbitration compensation from shipowners and operators. Four years later, the insurance dispute of this case is still under trial in federal courts in Florida and North Carolina.
Nisim sued Clear Blue Specialty Insurance, Yachtinsure Services and Aspen Insurance, demanding payment of at least $500,000 in policy compensation. Clear Blue recently won a lawsuit in the North Carolina court, demanding that Yachtinsure fulfill its contractual obligations and continue to handle the high claims. The judge held that the public interest requires insurance companies to handle claims in a timely manner and ensure the enforcement of contracts.
The crux of the dispute lies in Yachtinsure’s refusal to pay compensation on the grounds of “unapproved steering operator”, but the policy clearly states that the shipowner is the operator. In similar cases, the court once ruled that insurance companies could not refuse to pay compensation based on technical details.
Clear Blue accused Yachtinsure of refusing to defend it and complete the claim settlement, which might harm the interests of the company and policyholders. Yachtinsure countered that only one claim remained pending and that it had always adhered to the contract.
This case reveals the complex operation of high-end Marine insurance and the issue of role conflicts between the management agent (MGA) and the claims company. The outcome of the lawsuit may have a profound impact on the insurance industry‘s handling of high-value claims.
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