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Aon Hit with Lawsuit by Washington, D.C. MTA

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Posted on 21 Jan 2011

Alleging that the insurance advisor failed to protect the operators of the Washington, D.C., Metro system from “avoidable out-of-pocket casualty losses," the the Washington Metropolitan Area Transit Authority has filed suit against Aon Risk Services.

The 24-page suit accuses Aon of failing to inform the transit agency of coverage limits, leading to additional costs of $9 million since a June 2009 Metro Red Line crash near the Fort Totten Station, according to the Washington Post. That crash, the worst in the subway’s history, led to nine deaths, including the driver, and injuries to dozens of others after a failed track sensor sent the train, moving at 50 mph, into the back of a stopped train.

The newspaper reported that the three-tier liability program established for the Metro system, which has a $2.1 billion annual budget, forces Metro to pay increasing fees and deductibles for claims of up to $95 million. For the $5 million, $15 million and $75 million coverage layers, Metro pays a $5 million deductible.

The WMATA contends in the suit that gaps in coverage are causing it to pay crash victims and survivors from its funds, not insurance.

An Aon spokesman told the Washington Post the suit is “meritless.”

The suit, according to the newspaper’s report, said WMATA paid more than $559,000  annually for “the best service, the beset counseling and the best protection available,” but alleges that Aon “failed in its most fundamental and important responsibility: Protecting WMATA against avoidable out-of-pocket casualty losses.”


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