Chubb Unit Sues to Duck Flint Hospital Contamination Deal (1)

A Chubb Ltd. insurance unit is suing to avoid paying for a roughly $40.5 million settlement resolving lawsuits alleging injuries from legionella and lead contamination at a hospital in Flint, Mich., run by McLaren Health Care Corp.

ACE American Insurance Co. has no indemnification obligation due to misrepresentations in McLaren’s insurance application as well as McLaren’s late notice of the claims, the insurer said in a lawsuit filed Tuesday in the US District Court for the Eastern District of Michigan.

Michigan’s Eastern District is also where the underlying lawsuits were consolidated.

McLaren first became aware of the outbreak in ...