AIG Subsidiary’s Obligation Questioned in Passenger Safety Lawsuit Against Bus Company

The debate over an insurance company’s duty to defend its policyholder takes a complex turn as an AIG subsidiary, National Union Fire Insurance Co. of Pittsburgh, declines to defend Autobuses Ejecutivos LLC in a lawsuit involving multiple kidnappings. The lawsuit, filed in Hidalgo County, alleges that the bus company failed to warn passengers of dangers, despite knowing about regular incidents of passengers being kidnapped, beaten, and held for ransom while traveling on their buses in Mexico. National Union has sought a declaratory judgment in the Southern District of Texas, asserting that it has no obligation to indemnify or defend its policyholder in this case.