Silverstein: I'll Rebuild Despite Loss To Insurers

By Michael Ha

NU Online News Service, may 4, 2:04 p.m. EDT?Developer Larry Silverstein, reacting to a jury verdict that found 10 insurers owe half the amount he was seeking from them for the destruction of the World Trade Center, said his legal defeat will not halt the rebuilding at Ground Zero.[@@]

Under the verdict he would recover about $1.96 billion from those 10 carriers.

A related case involving some $1 billion in gross property coverage on a single-occurrence basis is due for trial.

"Of course, I am disappointed that the jury did not see things our way with respect to most of the insurers in the WTC coverage," Mr. Silverstein said. "But let me be clear. A defeat in the courtroom is not a defeat for rebuilding."

His remarks followed yesterday's proceedings in U.S. District Court in Manhattan, where the jury agreed with Mr. Silverstein's largest insurer for the Trade Center, Swiss Reinsurance, that his coverage was based on a Wilprop form defining the terrorists' toppling of the Twin Towers as one compensable event, not two.

Mr. Silverstein said he is now ready to move on to the next phase of trial related to his coverage dispute.

The verdict, delivered late yesterday afternoon, came on the heels of a partial verdict last week that found nine other insurers are bound by the Wilprop form. The form's occurrence definition limits the WTC attack to a single insured event and leaves no possibility for Mr. Silverstein's claim that the 9/11 terrorist attack was two reimbursable events for those carriers. These 10 insurers have combined gross property coverage of around $1.96 billion. Swiss Re's overall share including Swiss Re U.K. made up about a quarter of the entire Trade Center gross coverage of $3.55 billion.

The jury found that just three insurers?Royal Specialty Underwriting, Twin City Fire Insurance and Zurich America Insurance?are not bound by Wilprop, which leaves their maximum exposure still in doubt.

On a single-occurrence basis, the gross WTC property coverage for these companies adds up to around $227 million. These three insurers would join Allianz, Gulf, IRI, TIG, Tokio Fire and Marine, and Travelers?whose gross coverage for WTC adds up to about $870 million?to face the next phase of the trial over whether the terrorist attack was one or two events. Those proceedings are expected to begin shortly, although no date has been set.

Mr. Silverstein said that whatever happens in court, he is determined to rebuild the World Trade Center, under New York Gov. George Pataki's leadership and in keeping with the master plan.

Mr. Silverstein commented that, as the evidence of his determination to rebuild, "Seven World Trade Center is rising as we speak?we are up to about 20 stories of 52 total. We expect it to be ready for occupancy by the end of 2005."

In coming months, he said, "we will break ground for the Freedom Tower?the world's tallest building?and we will complete it as scheduled in 2009."

Mr. Silverstein added he is now ready to move on to the second phase of the trial, with more than a billion dollars worth of per-occurrence coverage at stake.

"We feel the evidence is strongly in our favor and look forward to our next day in court. And we're looking forward to the day when this litigation ends so we can focus all of our attention on rebuilding," Mr. Silverstein said.

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Silverstein: I'll Rebuild Despite Loss To Insurers

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