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Appeals court rules insurer can’t collect $1.2 million owed by policyholder

Court claims insurer waited too long to send the bill

If you want to get paid, it usually helps to send a bill, at least in an expedient fashion. Such was the situation with a New York Court of Appeals ruling yesterday, when it denied American Zurich Insurance Co.’s (Zurich) claims against Hahn Automotive Warehouse.

Hahn originally had purchased general and automotive liability and workers’ compensation policies from Zurich for a period between 1992 and 2003, which had required the insurer to occasionally recalculate premiums and either bill for the owed sum or refund the balance. However, in 2005, Zurich did an audit in which it discovered that it had neglected to bill Hahn for about $1.9 million, and that it also owed Hahn about $260,000 in refunds. Zurich then invoiced Hahn three times in 2005 and 2006, but Hahn refused to pony up.

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