Ott v. All-Star Insurance Corp.

The issue in this case is whether an excess-of-policy-coverage clause physically incorporated later into a reinsurance treaty between the North Star Reinsurance Corporation and the All-Star Insurance Corporation made North Star the liability insurer of All-Star in respect to actions brought against All-Star by its own insured, DeNoon Beach, for its bad faith or the negligent failure to settle a third-party claim within policy limits.

We conclude that the excess-of-policy-coverage clause added to the original reinsurance agreement made North Star the liability insurer of All-Star. Accordingly,…