K&L Gates Explains: Who Will Be Handling Your [Asbestos] Claims Under Berkshire Hathaway’s Lates
Berkshire’s appetite for asbestos claim revenue has generated numerous interesting deals, to the least. The latest pair of deals received some public analysis in a July 13, 2017 web site article by insurance coverage lawyers at K & L Gates. The introduction describes the deals reviewed; see the full article for the conclusions.
“Earlier this year, NICO announced that it had entered into two new retroactive reinsurance transactions –one with various AIG group insurers (the “AIG/NICO Deal”) and the other with the Hartford group insurers (the “Hartford/NICO Deal”). These two recent transactions differ from many of NICO’s prior retroactive reinsurance deals ─in which NICO and its affiliated claims-handling entity, Resolute Management Inc. (“Resolute”), had been given claims-handling responsibility ─ in that the recent transactions do not purport to give control of claims handling to NICO (and Resolute).
Despite representations in the press releases from AIG and Hartford announcing these deals that they (and not NICO) will maintain control of claims handling, a careful reading of the transactional documents for the AIG/NICO Deal and the Hartford/NICO Deal reveals that NICO gained important rights related to claims handling which, if fully exercised, could significantly impact how policyholder claims are handled and resolved (and, ultimately, whether those claims are paid). This Alert discusses how policyholders may be impacted by NICO’s exercise of the claims-handling related rights provided to it under the AIG/NICO Deal and the Hartford/NICO Deal.”