AmTrust Insurance Unit Wins Appeal Over Defamation Defense Costs

An AmTrust Financial Services Inc. insurance unit can avoid paying for an investment adviser’s legal fees incurred in a defamation suit because the policy bars overlapping coverage, a federal appeals court said.

Associated Industries Insurance Co. doesn’t have to pay for Susan Harriman’s $1 million in defense costs because her primary insurance policy already provided coverage, the US Court of Appeals for the Fourth Circuit said Wednesday. Associated’s excess insurance policy has a clause that precludes coverage when a primary insurer is on the hook, the appeals court said.

“The existence of the Travelers policy—standing alone—gave Associated a good faith ...