Industry Reacts to Calif. Holocaust-era Decision

California Insurance Commissioner John Garamendi released the following statement regarding the United States Supreme Court’s decision to defeat a California law required insurance companies to provide information about all of their Holocaust-era policies.

“For more than 60 years insurance companies have held money that does not belong to them. They have stonewalled the legitimate heirs of Holocaust victims, refusing to provide basic insurance policy information that could help them collect on policies bought by their ancestors.

“The United States Supreme Court, in a 5-4 decision, struck down a California law that would have required insurers to provide heirs with this information. I am deeply disappointed the court did not uphold the constitutionality of the Holocaust Victims Insurance Relief Act, and that it did not see fit to require insurers to live up to their moral obligations. Now, the ball is in the Bush Administration’s hands.
President Bush has the legal and moral responsibility to ensure that these heirs do not continue to be victimized by insurance company secrecy. These survivors are aging and they are dying. In this case, delayed justice is no justice. I urge the president to take decisive action and force these insurers to stop impeding the course of justice,” Garamendi said.

“I also strongly urge Congress to continue its consideration of legislation that would address this problem. And I request that the International Commission on Holocaust Era Insurance Claims (ICHEIC) press its member companies to comply with its disclosure obligations. Survivors and their families should continue to submit claims to ICHEIC and to individual companies if they have any reason to believe that there may be insurance proceeds that are due them.

The American Insurance Association (AIA) reacted favorably to 5 to 4 ruling by the U.S. Supreme Court in the cases of American Insurance Association v. Garamendi and Gerling Global Reinsurance Corp. of America v. Garamendi.

“We are gratified by the Supreme Court’s decision,” said Craig Berrington, AIA Senior Vice President and General Counsel. “While there is no way to provide absolute justice for Holocaust victims and their families, we believe that the International Commission for Holocaust Era Insurance Claims (ICHEIC), which was established specifically to handle Holocaust insurance claims, is the best way to provide a measure of financial relief today. As both the Clinton and Bush Administrations made clear during this long litigation process, the issues remaining from the Holocaust are matters for the United States government, not individual states.”

The litigation was brought in response to enactment of a California law requiring insurance companies operating in that state to provide detailed reports about Holocaust-era polices or forfeit their ability to sell insurance in California. Among the arguments AIA presented to the Supreme Court was the fact that such a law exceeds state legislative and regulatory jurisdiction and jeopardizes the federal government’s ability to conduct foreign affairs.

The ICHEIC was created to resolve Holocaust-era insurance claims and is supported by the U.S. government. ICHEIC participants include several major European insurers, the National Association of Insurance Commissioners (the trade association for state insurance regulators), European regulators, representatives of several Jewish organizations, and the State of Israel.