2 August 2017Insurance

Kanye West sues Lloyd’s syndicates including Cathedral: report

US rapper Kanye West filed a $10 million lawsuit over his cancelled tour against several Lloyd’s syndicates, including Lancashire Group’s Cathedral Syndicate, according to an August 1 report by The Hollywood Reporter.

West allegedly claims that the syndicates are stalling on paying out claims emanating from a cancelled tour. A loss claim was tendered just two days after West checked himself into a psychiatric centre, but he and his company — Very Good Touring, Inc. — still have not been paid more than eight months later, according to the suit.

"Nor have they provided anything approaching a coherent explanation about why they have not paid, or any indication if they will ever pay or even make a coverage decision, implying that Kanye’s use of marijuana may provide them with a basis to deny the claim and retain the hundreds of thousands of dollars in insurance premiums paid by Very Good," the publication cites a complaint filed Aug.1 in California federal court. "The stalling is emblematic of a broader modus operandi of the insurers of never-ending post-claim underwriting where the insurers hunt for some contrived excuse not to pay."

Responding on a request for comment by Intelligent Insurer, a Lloyd’s spokesman said:

“We cannot comment on the specifics of this legal case.

“The reputation of the market has been built on meeting our obligations quickly and effectively where a claim should be settled. In the last year alone we paid out over £14billion in claims."

West's lawsuit addresses one of the additional concerts of his "Saint Pablo Tour" and notes the "strained, confused and erratic" behaviour in Sacramento, as well as the decision made the following day to cancel the balance of the tour and issue full refunds. He was soon hospitalized at UCLA, and the insurance companies were informed and later provided with sworn testimony from his primary physician there that West suffered a debilitating medical condition that required he not tour.

But that wasn't good enough for the insurance companies, according to the suit.

"Almost immediately after the claim was submitted, Defendants selected legal counsel to oversee the adjustment of the claim, instead of the more normal approach of retaining a non-lawyer insurance adjuster," states West's complaint. "Immediately turning to legal counsel made it clear that Defendants’ goal was to hunt for any ostensible excuse, no matter how fanciful, to deny coverage or to manoeuvre themselves into a position of trying to negotiate a discount on the loss payment."

West's court papers reveal the extent to which he has been attempting to convince the insurers that his mental breakdown was indeed real, according to The Hollywood Reporter.

"While Kanye was still under medical care for his disabling condition, the Defendant syndicates demanded that Kanye submit to an immediate IME," states court papers, referring to an independent medical examination. "Kanye was made available for a purported IME by a doctor, hand-selected by the insurers’ counsel, who was predisposed to look for some reason to deny the claim. Yet even Defendants’ selected doctor had to admit that Kanye was disabled from being able to continue with the Tour. As demanded by the insurers, Kanye was also subsequently presented for an examination under oath (“EUO”), and at least eleven other persons affiliated with Kanye and Very Good were similarly presented for EUOs."

West still can't get answers about why the insurance companies won't pay up, but according to court papers, the insurers demanded to interview others outside of West's control to make a determination.

The Lloyd’s spokesman commented: “The market will always take steps to find a solution amicable to both clients and insurers where there are disagreements through discussion and mediation.

“However, where an agreement cannot be reached, valid claims can only be paid on syndicates being satisfied that they have the information required to make any payment.”

Cathedral Syndicate or Lancashire Group were not immediately available for comment.

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More on this story

27 January 2017   Andrew McKee, the former CEO of MS Amlin Underwriting at Lloyd's, who left the company in December 2016, is set to join Cathedral Underwriting (CUL) as chief executive officer.
31 August 2017   Lloyd’s syndicates facing a $10 million lawsuit by US rapper Kanye West over a cancelled tour have countered his claims they believe are invalid.
21 September 2017   Singer Kanye West, through attorneys of his touring company Very Good Touring denied “each and every allegation and mischaracterization in the counterclaim” made by Lloyd’s syndicates with respect to a cancelled tour.