Oregon Ducks Flag Insurer for $688,000

     EUGENE, Ore. (CN) – The University of Oregon sued an insurance broker for $688,000 for denying a claim on a policy it bought to cover coaches’ bonuses for the 2012-2013 football season.
     The Oregon Ducks finished the 2012-2013 season by winning the Fiesta Bowl, and ranked 5th in the nation, after going 11-1. In anticipation of such a year, the school had followed a recent trend in sports and bought contractual bonus insurance to help stem the cost of coaches’ bonuses.
     The university filed a claim on the policy, but defendants Monica Drummer, with Arthur J. Gallagher Risk Management Services, denied it, the university claims in Lane County Court.
     Drummer and the Gallagher firm are the only defendants. The school claims they sold it a Lloyd’s of London policy for a $490,000 premium, under false pretenses.
     The university claims the defendants assured it the policy included contingencies for every possible bonus amount, depending on how far the team progressed in the rankings and post-season bowl games.
     The school claims that as far back as July 2012, executive senior associate athletic director Eric Roedl approached the Oregon University System’s chief risk officer Ellen Holland with the idea of obtaining bonus insurance.
     Before taking the idea to Holland, Roedl worked with a different firm to iron out details on a policy for partial and maximum amounts, not knowing the Oregon University System required insurance through a preferred broker. Holland passed the policy to Drummer, along with Roedl’s email correspondence with the previous agent, so she could draw up an identical policy, according to the lawsuit.
     On Sept. 7, 2012, the university says, it received the policy for final review, to find that it mainly referred to maximum bonuses, to be paid if the team finished the season under a strict set of circumstances.
     In an email exchange, Gallagher’s broker reassured the university that the policy covered even partial payment, even going so far as to include an example, according to the complaint.
     The school claims that the Gallagher firm informed it in writing: “Any one item can trigger a partial payment of the loss limit. Referring to page 6 of the quote, if any one or combination of events occurs, the policy will pay.”
     The school seeks $688,000 to recover the costs incurred by honoring its contractual obligations, and damages for negligent misrepresentation and breach of duty.
     It is represented by Joshua Stump, with Harrang, Long, Gary, Rudnick, of Portland.
     The University of Oregon Ducks are ranked No. 2 in the nation this year, and will face Ohio State for the National Championship on Monday, Jan. 12.

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