Insurers Must Cover Ill. City's Wrongful Arrest Loss

Law360, New York (March 4, 2011, 5:48 PM EST) -- American Safety Casualty Insurance Co. and Interstate Indemnity Co. owe an Illinois city nearly $11.4 million in coverage for a civil judgment from a wrongful rape conviction, a federal judge said Thursday.

Primary insurer American Safety breached the provisions of its insurance contracts and is obligated to indemnify Waukegan, Ill., to its $1 million policy limit, Judge Virginia M. Kendall ruled in the U.S. District Court for the Northern District of Illinois.

In addition, American Safety must pay the city nearly $1.1 million in interest and...
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