In re Liquidation of Legion Indemnity Co.

(Court opinion corrected 7/19/13.) Ten-year-old girl died when her bicycle was caught between curb and school bus. Bus company's primary and excess insurer was declared insolvent and placed into liquidation prior to trial, and bus company filed for bankruptcy on eve of trial. Parties reached settlement, with bus company to pay $1.2 million, and parents assigned to bus company their rights to any payment from their insurer. Liquidator recommended that school principals' claim in liquidation of insurer be approved for $1.2 million, although claim sought remaining $5.75 million limits. Court properly entered order approving Liquidator's recommendation, as otherwise bus company would have a windfall of $5.75 million. Policy behind general insurance is to indemnify the insured for loss, not provide windfall profit. Weight afforded settlement is not conclusive and is to be determined by Liquidator. (HARRIS and QUINN, concurring.)