More on McCarran-Ferguson Reverse Preemption

As you may or may not recall, we discussed the doctrine of McCarran-Ferguson Reverse Preemption some time ago and noted that it was working its way through the Texas Courts of Appeals. This past week (on January 11 actually), the Fifth Circuit weighed in, affirming a trial court denial of a motion to compel arbitration on McCarran Ferguson grounds.

Under Mississippi law, an uninsured motorist automobile insurance policy cannot require arbitration of claims arising under it. Mississippian Jack Inman got into a coverage dispute with his UM carrier which the carrier tried to send to arbitration, arguing that the FAA preempted the Mississippi statute. The district court disagreed, holding that since the Mississippi law was designed to regulate the business of insurance, the McCarran Ferguson Act precluded its preemption by the FAA. The Fifth Circuit affirmed and provided a short opinion (link is to .pdf file) that nicely explains the doctrine of McCarran Ferguson Reverse Preemption in the circuit.

American Bankers Ins. Co. of Florida v. Inman, Cause No. 04-61131

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arbitration, ADR, Fifth Circuit, Texas Supreme Court