March 2007

Are IBNR liabilities recoverable from reinsurers? 

EAIC v AXA:   In the recent decision of English and American Insurance Co Ltd (In a Scheme of  Arrangement) v Axa Re SA [2006] EWHC 3323, Mrs Justice Gloster addressed an application for summary judgment by a reinsured against its reinsurer in a claim for recovery of sums paid pursuant to a settlement of both paid claims and IBNR. The decision will be of great interest to reinsureds seeking recovery on their reinsurances, as, although Gloster J did not in fact grant judgment for the sums relating to payments for IBNR, it would appear from her comments that she would have felt able to do so.

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