Hartford Sues Peanut Corp To Determine Coverage Terms

   DOW JONES NEWSWIRES 
 

Insurer Hartford Financial Services Group Inc. (HIG) filed suit to determine whether it must pay claims filed by victims of a salmonella outbreak that has led to more than 500 illnesses and may have contributed to eight deaths.

Hartford said the number of claims asserted against Peanut Corp. of America seeking damages because of injury, sickness or disease is likely to rise. As such, it is examining the coverage terms and whether it limits or nullifies coverage for one or more of the salmonella claims. The suit was filed in federal court in Virginia on Tuesday.

Hartford spokesman David Snowden said, "We believe this will help clarify the claims process."

The Food and Drug Administration had traced the illnesses to a Georgia processing facility owned by Peanut Corp.

The company, which recalled its products dating back to Jan. 1, 2007, said in a statement released Wednesday that inspections of the Blakely, Ga., facility were performed by federal and state regulators in 2008, and said its plant got an overall superior rating on one visit and another was found to "meet or exceed" expectations.

Peanut Corp. added that due to the nature of the continuing investigation, it couldn't comment on the facts related to the product recalls.

The House Energy and Commerce Committee plans a hearing on Wednesday to examine the salmonella outbreak.

Peanut Corp. supplies peanut butter and peanut paste to institutional users, such as schools and nursing homes, and to food processors that use them in a wide range of products such as cookies, snacks and dog treats.

-By John Kell, Dow Jones Newswires; 201-938-5285; [e-mail]