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Benefits Of The U.S. Program For Terrorism Insurance From A Comparative Perspective, Jeffrey E. Thomas
Benefits Of The U.S. Program For Terrorism Insurance From A Comparative Perspective, Jeffrey E. Thomas
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This article summarizes the U.S. program for terrorism insurance and outlines its advantages as compared to similar programs in other developed countries. The program, while similar to reinsurance, does not require participants to pay premiums but instead uses an ex post recoupment mechanism. Consequently, it is generally referred to as a Federal “backstop.” This approach requires less capital investment and makes “pricing” more accurate than a reinsurance approach. The program also requires insurers to maintain significant amounts of exposure through insurer deductibles and copayments, which creates market demand for the development of terrorism reinsurance in the private market. The current …
Extra-Contractual Liability In The Restatement Of The Law, Liability Insurance: Breach Of The Duty To Settle Or Bad Faith?, Jeffrey E. Thomas
Extra-Contractual Liability In The Restatement Of The Law, Liability Insurance: Breach Of The Duty To Settle Or Bad Faith?, Jeffrey E. Thomas
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This paper focuses on the Restatement’s treatment of an insurer’s duty to settle and the duty of an insurer to act in good faith in handling liability claims. The duty to settle is framed as an objective “duty to the insured to make reasonable settlement decisions.” At the same time, however, a separate claim is retained for an insurer’s “bad faith” breach of its duties (including the duty to settle). Further, a subjective element is adopted for the bad faith standard. To be liable for “bad faith,” an insurer must act “without a reasonable basis for its conduct” and must …