A federal Court applying Illinois law recently held that there is no statutory bad-faith claim against a reinsurer's agents under 215 Ill. Comp. Stat. (ILCS) 5/155 because that statute does not apply to reinsurance contracts or to reinsurers' agents. The federal Court followed a legion of State Court decisions. Stonegate Ins. Co. v. Fletcher Reins. Co., No. 21 CV 3523, 2021 WL 5769528, at *7-*8 (N.D. Ill. December 6, 2021). As the Court wrote: "Given this precedent, it is clear that Section 155 does not permit a bad faith claim to be brought against a reinsurer’s agents, such as the Defendants. In other words, Stonegate cannot bring a claim against Defendants under Section 155, because Section 155 pertains only to insurance contracts – not reinsurance contracts." Stonegate, 2021 WL 5769528, at *8 (emphases by the Court).
See generally 1 DENNIS J. WALL, LITIGATION AND PREVENTION OF INSURER BAD FAITH § 6:11, Primary And Excess Insurers And Reinsurers: A Working Definition of Reinsurance--The Effect of Reinsuring Agreements or Treaties (3d Edition Thomson Reuters West, 2022 Supplements in process).
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