February 5th, 2007

The Royal & Sun Alliance insurance group is being sued by General Motors after being accused of trying to avoid payments of over half a billion dollars in asbestos related claims. The lawsuit was filed at the end of last week in Delaware Chancery Court in Wilmington.

According to the accusations made by General Motors the London based Royal & Sun Alliance insurance group is obligated to make payments on claims that have been against policies that were in force between 1954 and 1971. However, General Motors further claims that the insurance company is liquidating operations in the United States in order to avoid having to make the payments.

As the liquidation of the insurance company’s US operations continues, General Motors states that it has decided to file the lawsuit so that is can make sure claims "are not barred by any applicable statutes of limitation." The company’s lawsuit against the insurer in Michigan was thrown out of courts, with the judge stating that the company had waited too long to file the lawsuit, a decision against which GM plans to appeal.

One official from a subsidiary company of Royal & Sun Alliance, called Arrowpoint Capital, stated that the latest case was simply the same thing as the Michigan case but simply rehashed. He said: "This is nothing more than the same old arguments wrapped up in a new package."