Article ID: de5fad8d78854e3490f7230450a8118289b47af855f055ee5582c9e758ba266e
Source ID: secondary:businessinsurance.com
Published At: -
Extraction Method: bs4_heuristic
URL: https://www.businessinsurance.com/retirement-plan-administrator-loses-40m-cover-bid/
Body Text
Retirement plan administrator loses $40M cover bid - Business Insurance Skip to content Register for free Search Search Log In Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Retirement plan administrator loses $40M cover bid by Richard Sine Coverage Disputes Aug 24, 2026 A unit of American Family Insurance and two co-insurers do not have to cover a $40 million settlement paid by a retirement plan administrator accused of failing to catch a years-long fraud scheme carried out by a church executive, a California federal court ruled Thursday. The case, Homesite Insurance Company et al. v. Newport Group Holdings, L.P. et al. , is rooted in an embezzlement and fraud scheme in which nearly 5,000 active and retired employees of the African Methodist Episcopal Church saw their retirement accounts lose 70 percent of their value. The retirees lost about $250 million, according to the initial complaint. In a federal class action pending in Tennessee federal court, the retirees accuse the Rev. Dr. Jerome V. Harris, the church’s longtime retirement services director, of embezzling and misappropriating funds from the AME Church’s retirement plan for two decades. Rev. Harris died in 2024 of a heart attack. Newport, the plan’s third-party administrator, was accused of breaching its fiduciary duties by sending plan participants account statements showing investment values it could no longer verify, without flagging the problem to the church. Newport agreed to pay $40 million to settle those claims without admitting fault, part of a combined $60 million recovery that also included $20 million from the church itself, according to news reports. The insurance dispute in U.S. District Court for the Northern District of California centered on a prior acts exclusion in Newport’s management liability policy, which bars coverage for wrongful acts predating Aug. 31, 2018, as well as any later acts “interrelated” with those earlier ones. Newport argued that earnings reports it issued about certain investments before and after the 2018 cutoff date were not sufficiently connected to trigger the exclusion, and that only proven facts — not mere allegations — could establish that connection. Judge Alex G. Tse, a U.S. Magistrate Judge, disagreed on both points, finding that allegations are enough to establish “Interrelated Wrongful Acts” under the policy’s own terms. “The alleged actor is the same,” Judge Tse wrote, “the alleged conduct is the same,” and “the alleged victims are the same (Plan participants) and the harm is therefore the same.” He concluded that the allegations were “causally connected by reason of a series of common facts, circumstances, situations, transactions, or events,” triggering the exclusion and eliminating coverage. Plaintiffs Homesite Insurance Company, based in Boston, Argo Group unit Argonaut Insurance, of San Francisco, and Liberty Mutual unit Ironshore Indemnity won summary judgement against Newport. Newport was acquired in 2022 by Ascensus of Dresher, Pennsylvania. Ascensus did not immediately respond to a request for comment. Related News California high court says comp board missed review deadline August 24, 2026 Wrong turn puts Munich stadium on Sydney Marathon medal August 24, 2026 NCCI recommends 7.4% Florida workers comp rate cut August 24, 2026 Food manufacturer cited after three worker deaths August 24, 2026 Price cuts threaten big four reinsurers’ earnings: Fitch Ratings August 24, 2026 Dutch regulator fines Uber $966M August 24, 2026 ASR Nederland’s profit jumps more than sixfold August 24, 2026 Catastrophe claims cut Triglav’s profit August 24, 2026 Reinsurance profit lifts MNRB’s earnings August 24, 2026 Facebook-f X-twitter Linkedin-in Business Insurance is a singular, authoritative news and information source for executives focused upon risk management, risk transfer and risk financing. Never miss important news: Become a Business Insurance Online subscriber today Subscribe Now Information About Us Contact Advertise Privacy Policy Terms & Conditions Copyright 2026. BUSINESS INSURANCE HOLDINGS Member, Beacon International Group, Ltd.
Metadata (JSON)
{
"score": 15.016666666666667
}