SCOR to take WTC settlement to arbitration

SCOR Reinsurance has served notice that it intends to take to arbitration a recent US$2-billion settlement that was designed to bring an end to the six-year legal battle between seven insurers and the leaseholder of the World Trade Centre over the value of the insurance policies covering the centre.
New York Governor Eliot Spitzer and Insurance Superintendent Eric Dinallo recently announced the settlement at a news conference in lower Manhattan.
The US$2-billion settlement brings to about US$4.55 billion the total insurance proceeds Silverstein and the Port Authority of New York and New Jersey will receive as a result of the destruction of the World Trade Centre, which was hit by hijacked commercial airplanes in 2001.
Litigation turned on whether the towers, which were hit by two airplanes, were destroyed by one or two terrorist occurrences according to the terms of the insurers policies.
Seven insurers included in the settlement are Travelers Cos., Zurich American Insurance Co., Swiss Reinsurance Co., Employers Insurance Company of Wausau, Allianz Global Risks U.S. Insurance Co., Industrial Risk Insurers and Royal Indemnity Co., Spitzer said in a statement.
SCOR had a reinsurance contract with Allianz for the World Trade Centre.
SCOR considers that the Allianz settlement agreement does not respect the terms and conditions of the Certificate of Reinsurance between SCOR and Allianz, SCOR noted in a brief statement on its Web site. SCOR has already informed Allianz that this settlement exceeds the contractual requirements and contains ex gratia elements.
Under the terms of the clause set out in the Certificate of Reinsurance, SCOR has requested that this case be referred to arbitration.