Florida Federal Court Dismisses Reinsurer's Agent From Breach Of Contract Lawsuit

In this case, the ceding company, VIP Universal Medical Insurance Group Ltd. ("VIP"), brought an action in Florida federal court against its reinsurer, BF&M Life Insurance Company Ltd. ("BF&M"), and International Reinsurance Managers LLC ("IRM"), BF&M's agent, alleging breach of a reinsurance contract, in which BF&M reinsured VIP for medical claims in excess of $200,000. It was alleged that BF&M refused to pay a claim for $139,000 and that IRM had "directed the non-payment" of such claim. IRM moved to dismiss, arguing that it cannot be held liable for breach of contract, where it is not party to a contract.

The Florida federal court agreed with IRM, noting that under Florida law, "an agent for a disclosed insurer is not liable to the insured on the insurance contract." The court noted that even taking the allegations that IRM acted as agent and "directed" the...