Jefferson Pilot Financial Insurance v. Marsh USA Inc.

TYSON, Judge.

I. Background

Hartford Fire Insurance Company (“Hartford”) provided Jefferson Pilot Financial Insurance Company (“JP”) with fidelity bond coverage. Hartford issued a Form 25 Financial Institution Bond that covered wrongful acts of JP’s insurance agents for three years, between 27 March 1992 and 27 March 1995. In September 1994, Martin Pallazza (“Pallazza”), Hartford’s bond underwriter in charge of the JP account, reviewed JP’s 1993 Annual Report and discovered JP had added over 3,000 new agents to its network and planned for further additions. Pallazza questioned, in a notation on…