HCI Group Inc Wins Court Case Against Aon Benfield In RSA Dispute
HCI Group, Inc. formerly Homeowners Choice, Inc., announced that it has won a breach of contract dispute with reinsurance intermediary giant Aon Benfield in which HCI claimed monies were owed under a 2009 revenue sharing agreement. Such agreements are commonly called RSAs. In 2009, Aon agreed to share with HCI revenues Aon would receive when placing HCI's reinsurance coverage. Later, it refused to pay after HCI elected to use another intermediary for the following year. According to Aon, the RSA contained a clause that said no shared revenue would be payable any time after HCI decided to terminate or replace Aon and that HCI therefore forfeited its a share of the revenue when it did not renew its relationship with Aon. HCI sued in federal court in Chicago, Illinois contending the RSA, which was authored by Aon and contained no renewal provisions, was never intended to be more than a one-year deal and the purported forfeiture provision was ambiguous and thus not enforceable. The federal trial judge agreed with HCI and on March 23, 2013 awarded HCI $744,402.06 in damages and interest.
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