Anna Jiwon Park has been covering the politics at The Korea Times since the summer of 2024, when she joined the press pool for the Office of the President in Korea. Prior to that, she spent about five years reporting extensively on financial markets, regulatory authorities and the financial industry. She joined The Korea Times in 2019 after spending eight years as a broadcast journalist at Arirang TV, Korea’s leading global broadcaster, covering politics, defense and culture.
Korean Re sues AXA, Allianz in London
Korean RE logo
By Anna J. Park
By Anna J. Park
Korean Reinsurance Company, or Korean Re, filed lawsuits against Allianz and AXA at a U.K. court earlier this month, asking the two global financial firms to pay a total of $12.4 million based on their reinsurance contracts, to cover the cost of insurance of the Stellar Banner ― a 300,000-ton vessel grounded off the Brazilian coast last year.
According to the U.K. court documents, Korean Re claimed that the two insurers breached their reinsurance contracts made in 2019.
Polaris Shipping, the Korea-headquartered owner of Stellar Banner, took out a $96.4 million insurance with Mertiz Fire & Marine Insurance back in 2019 against vessel accidents, while Meritz reinsured 83.8 percent of it with Korean Re.
Korean Re then signed two other reinsurance policies with AXA and Allianz in order to cut its exposure to the ship's accident. AXA agreed to take on 8 percent of the loss incurred by Meritz and Allianz 12 percent.
Following the vessel accident in February 2020 after leaving Brazil's Ponta da Madeira Maritime Terminal, Polaris Shipping had attempted to salvage the vessel months later, yet the cost of recovering and repairing the ship would exceed the insured value of the ship. Thus, the vessel turned into a total loss.
Korean Re continued to argue that it has fully indemnified its proportion of claim to Meritz as previously contracted. However, the two insurers through which Korean Re reinsured itself did not exercise their responsibility to reimburse their proportion in this case.
The Seoul-based reinsurance company not only asked the two firms to pay what they owed to reimburse for the loss claim, but also to cover legal costs.
“As negotiations on payment of the indemnification failed, further discussions moved on to the U.K. court, as both companies are based in Europe,” a market insider said.
An official from Korean Re said it has nothing further to say about the case as the legal process is already underway in London.