The Special Nature of International Insurance and Reinsurance Arbitration

Originally published by Beth Graham.

S.I. Strong, Manley O. Hudson Professor of Law at the University of Missouri School of Law and Senior Fellow at the Center for the Study of Dispute Resolution, has written “The Special Nature of International Insurance and Reinsurance Arbitration: A Response to Professor Jerry,” 2015 Journal of Dispute Resolution, Forthcoming; University of Missouri School of Law Legal Studies Research Paper No. 2015-21. In her scholarly article, Professor Strong expands on the policy and legal issues associated with international insurance and reinsurance arbitration.

Here is the abstract:

In his article, “Dispute Resolution, Insurance, and Points of Convergence,” Professor Jerry describes the numerous ways that insurance law intersects with dispute resolution. Through that discussion, Professor Jerry identifies the special nature of insurance disputes and challenges experts in both fields to work together to address the various legal and policy issues that exist in this area of law. This Response takes up that call with respect to one particularly intriguing field of inquiry: international insurance and reinsurance arbitration.

The focus of the current discussion is to illustrate the complexity of international insurance arbitration by describing some of the legal tensions that arise in this particular field. Three key conflicts exist. The first involves the interaction between international law and U.S. constitutional law. This issue arises as a result of the debate about the extent to which the McCarran-Ferguson Act reverse preempts certain legal principles in international disputes. The second type of conflict involves the tension between U.S. and foreign law. This discussion is placed in the context of Bermuda Form arbitration, although the points are equally applicable to other types of international insurance arbitration. The third and final type of conflict arises at the policy level. Here, the tension involves the pro-arbitration policy exhibited by the United States and other countries in matters involving international commercial disputes and the principle of state regulation to promote the public interest in insurance law. Inherent in this discussion is the question of whether private parties should be able to exercise their personal autonomy to create dispute resolution mechanisms that may subvert or conflict with certain public values.

Although the current analysis is intended to be introductory rather than comprehensive, the discussion nevertheless seeks to demonstrate the diversity and depth of legal and policy issues associated with international insurance and reinsurance arbitration. In so doing, this Response hopes to provide experts in both insurance law and dispute resolution with new insights about this particular procedure while also inspiring further work in this area.

A link to the article referenced by Professor Strong is available in an earlier Disputing blog post.  Additionally, many of Professor Strong’s research papers may be downloaded free of charge from the Social Science Research Network.

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