WTC Trial Hears Of Zurich ?Barroom Talk'

Thirteen of the insurers that provided coverage for the Trade Center are arguing the coverage in place would only allow a $3.5 billion payout for one event, while Trade Center leaseholder Larry Silverstein is arguing the two jetliners that crashed into the towers represent two reimbursable occurrences of nearly $7 billion.

In contention is whether insurers are bound to a Willis Property form, with a strict "occurrence" definition limiting the claim to one event, or a Travelers form, which leaves open a possible two-occurrence claim.

Paul Blackmore, the Willis' London broker who oversaw the marketing of the WTC placement in the London and European markets in 2001, said in court this week that Swiss Re, which provided the largest amount of coverage, knew the policy form governing the WTC coverage had been changed from the Willis Property form, or the "Wilprop" form, to the Travelers form prior to the terrorist attack.

Mr. Blackmore testified that he bumped into Swiss Re underwriter, Daniel Bollier on Oct. 3, 2001, at the Hotel Ascot bar in Zurich, Switzerland, and had a brief conversation. He said Mr. Bollier asked him if he [Mr. Blackmore] could re-insert the Willis Property form's definition of occurrence into the new operating form for him.

"I think I said I would report back to my colleagues and let him know if there is anything we can do. I didn't commit to anything," Mr. Blackmore said under questioning from Herbert Wachtell, attorney for Mr. Silverstein.

Testifying for Mary Kay Vyskocil, attorney for Swiss Re, Mr. Bollier said that contrary to Mr. Blackmore's claim, he never knew there was any switching of the policy form from Wilprop until he received the "Notice of Loss" document on Sept. 24, 2001.

"I said [to Mr. Blackmore], you know, I find it awkward that policies are now being switched after the event and, in addition, we had the right to review the wording, we had reserved all the rights, and now it's just being switched. And I mean at that point in time it was clear what it was all about, because it was in the press first of all," Mr. Bollier said.

"I told Mr. Blackmore that it's pretty obvious–because everybody can read the press, and insurers talk among each other?that it's about the occurrence definition," Mr. Bollier told jurors. "I told him, you know, I mean if that's what you are going to do, if you are going to switch the form on us, then, you know, please at least put your occurrence definition of Wilprop into Travelers."

Commenting further on the Notice of Loss statement, Mr. Bollier said, "It was really strange. In that notification of loss, there was a policy wording attached, which was not the Wilprop wording?and that's when I figured out that this was the Travelers form for the primary 10-million layer."