Canadian Underwriter

Fairfax wins British court battle

July 9, 2003   by Canadian Underwriter

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Insurance giant Fairfax Financial Holdings Ltd. say its Sphere Drake Insurance unit has won a battle in the U.K. courts against underwriting agents and brokers the company says defrauded it.
Sphere Drake (part of Fairfax’s European run-off group) alleged the underwriting agents and brokers had fraudulently written reinsurance contracts exposing the company to “grossly under-priced” U.S. workers’ compensation carve out business.
The U.K. Commercial Court found in favor of Sphere Drake, saying the underwriting agents and brokers acted dishonestly and in collusion.
The ruling means Sphere Drake has grounds to refuse payment of losses under the reinsurance contracts.

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