Ninth Circuit Rejects Excess Insurer's Attempt to Dispute Exhaustion of Underlying Insurance

September 28, 2020
J. Kelby Van Patten & Jared De Jong - Payne & Fears

This week, in AXIS Reinsurance Co. v. Northrop Grumman Corp., ____ F.3d ____, 2020 WL 5509743 (9th Cir. Sept. 14, 2020), the Ninth Circuit addressed an important question of first impression: When can an excess insurer second-guess an underlying insurer’s decision to pay a claim? Prior to AXIS Reinsurance, there had been no California or the Ninth Circuit case discussing an excess insurer’s right to make a covered-claims challenge to the exhaustion of underlying insurance, even though policyholders frequently encounter such arguments.

Reprinted courtesy of J. Kelby Van Patten, Payne & Fears and Jared De Jong, Payne & Fears
Mr. Van Patten may be contacted at kvp@paynefears.com
Mr. De Jong may be contacted at jdj@paynefears.com



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