Two Trade Center Insurers May Settle

According to Mr. Silverstein's attorneys, his litigation against 20 other insurers is proceeding.

Those insurers include Travelers Insurance Co., which provided primary coverage for Mr. Silverstein's companies, and Swiss Re subsidiary and excess insurer SR International Business Insurance Co., Ltd.

Those lawsuits center on Mr. Silverstein's claim that the separate plane crashes, which terrorists used to destroy the two towers of the complex, constitute two rather than one insurable event entitling him to approximately $7 billion from the insurers.

The insurance companies contend there was one coordinated attack constituting one insurable event and limiting payments to Mr. Silverstein to about $3.5 billion.

Ever since Swiss Re filed the first WTC-related lawsuit in October, Mr. Silverstein and a number of WTC insurers have waged their battle not only in court but also in the media. Although there has been no court hearing or decision to date, the parties have issued nearly weekly statements of actions taken or intended.

Neither Ace nor XL was willing to comment on the alleged settlement. They had both earlier sought to have the claim arbitrated in London, but Mr. Silverstein sued in U.S. District Court in New York last November to keep the dispute in New York.

In a separate but related development, Mr. Silverstein has applied to the District Court to require Swiss Re to post a $700 million bond to cover the insurer's exposure.

Mark Wolinsky, a partner in the New York firm Wachtell, Lipton, Rosen & Katz, which represents Mr. Silverstein's interests, said earlier that this was a claim "for the complete value of the lost property" and that Mr. Silverstein was reserving the right "to go back and ask for more."

One of the complicating factors in all of this litigation is that final insurance policies were not in place before Sept. 11. Mr. Silverstein had taken over the WTC leases in July.

He has claimed in court papers that the coverage to which Swiss Re and the other insurers committed through binders and slips did not define the term "occurrence," and that this makes the definition a matter of common law.

Mr. Silverstein also has also argued that Travelers passed around its own form in June, which did not specifically define "occurrence." He has claimed that Swiss Re and other insurers were told about the Travelers form before they agreed on July 26, 2001, to participate in the World Trade Center insurance program.

In Mr. Silverstein's view, those insurers bound coverage based on the Travelers form.