Nov 14, 2025

Ruling reinforces limitations of state jurisdiction over nonresident insurers Share The Indiana Court of Appeals has dismissed a lawsuit filed against a group of insurers that underwrote a $25 million fidelity bond for Cantor Fitzgerald, a financial services company that suffered a major fraud loss. The ruling reinforces the limitations of state jurisdiction over nonresident insurers, even when a resident carrier is involved. According to a report from BestWire, the insurers named in the lawsuit — Federal Insurance Co., U.S. Specialty Insurance Co., Liberty Mutual Insurance Co., and National Fire Insurance Co. of Pittsburgh, PA — collectively issued the bond covering Cantor Fitzgerald’s entities, including Tower Bridge. Federal, the only Indiana-based insurer, underwrote $10 million of the bond, while the other three nonresident carriers each underwrote $5 million. In 2020, more than $30 million was allegedly diverted from Cantor by a Tower Bridge employee and a third party. Cantor filed the lawsuit in May 2024, claiming breach of contract, duty of good faith, unjust enrichment, and promissory estoppel after the insurers declined to pay the full claim amount. Cantor argued that Indiana was the proper venue because Federal was a state resident and the companies had appointed in-state agents to receive legal documents. Court ruling on jurisdiction The appeals court largely upheld the lower court’s dismissal, ruling that merely complying with state insurance registration requirements or appointing an in-state agent does not establish personal jurisdiction over nonresident insurers. The court also rejected Cantor’s argument that the insurers had “banded together” with Federal, noting that the bond consisted of separate contracts and each insurer’s liability was limited to its portion of coverage. Further, the court found no minimum contacts connecting the claim to Indiana. Cantor and Tower Bridge are not Indiana corporate citizens, the bond was drafted in New York, and the alleged theft occurred in the United Kingdom, the report said. Implications for the insurance industry The decision underscores the importance of corporate structure and residency in fidelity bond underwriting and litigation. It also highlighted the challenges policyholders face when pursuing claims across state lines, particularly in multi-insurer arrangements. Fidelity bonds remain a critical risk management tool for financial services firms, and in Indiana, the largest writers in 2024 were Travelers Group (20.28%), Chubb INA Group (10.18%), CNA Insurance Companies (7.46%), Coaction Specialty Insurance Group (7.28%), and CUMIS Insurance Society Group (6.96%), according to BestLink. Industry observers note that understanding jurisdictional boundaries is essential for both insurers and policyholders when structuring bonds and resolving disputes. Liberty Mutual declined to comment on the litigation, and other carriers involved could not be reached for comment. Related Stories