Reinsurance disputes are subject to arbitration in Oklahoma
The Oklahoma legislature has not embraced arbitration. In fact, it seems somewhat hostile towards it. Thus, there has been some tinkering with Oklahoma’s arbitration act by the legislature. First, it said that the only types of insurance agreements that could be arbitrated were those between insurers, which would, of course, include reinsurance agreements. But then the statute changed to delete the exception which permitted arbitration between insurance companies. Then, it changed again to permit it. It was during these changes that Mid-Continent sued GenRe for failure to pay under the reinsurance contracts.
The trial court said that the arbitration clause was unenforceable, and that therefore, the suit could proceed. GenRe appealed, claiming that the arbitration clause was enforceable. It was after the trial court’s ruling and before the Tenth Circuit’s ruling that the law changed again to permit arbitration between insurance companies. The Tenth Circuit found the arbitration clause was enforceable, and that the change applied retroactively, since it was a procedural and not a substantive change.
Read the opinion:
Mid-Continent Casualty Co. v. General Reinsurance Corporation, Case No. 07-5050
