- Ten days ago, Mr. Chubb assumed Mr. Trump's $92 million bail in E. Jean Carroll's defamation appeal.
- But Mr. Chubb refused to handle the much higher appellate bond Mr. Trump currently requires in his New York state civil fraud case.
- The insurance giant faced backlash after agreeing to the Carroll bond.
Days after agreeing to the $92 million bail in former President Donald Trump's E. Jean Carroll defamation appeal, insurance giant Chubb is now offering the $500 million the Republican front-runner needed in a New York civil fraud case. His defense team revealed that he refused to accept Dorr's appeal bail. This was revealed in a court filing on Monday.
Mr. Chubb's decision leaves Mr. Trump one week until March 25, the deadline to either secure bail or pay New York City more than $456 million he currently owes on fraud charges. .
Chubb's “no, thank you” statement comes just five days after the company's CEO, Evan Greenberg, sent a letter to brokers, customers and investors addressing widespread criticism of the Carroll bonds. It was done a day later.
In 2018, then-President Trump appointed Greenberg to his key trade advisory council, a position he held until March 2023.
As first reported by Insurance Journal, Greenberg referred to the Carroll bond in his letter, saying, “If Chubb issues an appellate bond, even if the claim involves reprehensible conduct, “We are not making a determination on the claim.”
“I understand how polarizing and emotional this case and defendant is and how easy it would be for Mr. Chubb to just say no,” Greenberg added.
“But we support the rule of law and our role within it,” he continued. “We thought this was the right thing to do and frankly put our personal feelings aside.”
A Chubb spokesperson declined a request for comment from Business Insider. The Carroll bonds were underwritten by Chubb's subsidiary, Federal Insurance Company.
Nick Newton, immediate past president of the National Association of Surety Bond Producers, said reputational damage is a risk factor that all surety companies consider before agreeing to underwrite a bond.
“They're going to ask not only if they can trust this person, but is their personality a public relations issue,” said Newton, now a senior vice president at Assured Partners.
To secure bail for his fraud trial in New York, Trump would need to have “cash reserves approaching $1 billion,” his lawyers wrote in a Monday filing. .
It is unclear from the filing whether Mr. Chubb asked Mr. Trump to set aside $1 billion in cash as a condition of issuing the bond.
Experts told BI that surety companies typically require 110% to 120% collateral before underwriting bonds, like the $1 billion cash reserve mentioned by Trump's lawyers. Not 200%.
Still, “the carriers can set whatever number they want,” said Neil Pederson, owner of a surety bond agency. Pedersen & Sons.
Mr. Trump's lawyers said in a Monday filing that Mr. Chubb was the closest to a “yes” of about 30 insurance companies approached by the former president before saying “no.”
According to the filing, Chubb was the only carrier that tried to get Trump to consider listing the property before ultimately rejecting it.
But insurance companies virtually never accept real estate as collateral for appeal bonds, Newton said.
“If the appeal is unsuccessful, the judgment will be immediately payable,” Newton said.
“Accepting real estate requires extra paperwork and is not immediately liquid,” he said.
“No surety company will guarantee a bond that may have only 10 days to turn a commercial property into cash when the appeal deadline expires.”
Mr. Trump's lawyers are asking the Manhattan appellate court to rely on the strength of his real estate holdings, rather than requesting a stay of judgment in the form of cash-back bonds.
Lawyers for New York Attorney General Letitia James, who successfully sued President Trump alleging widespread financial records fraud, say that simply promising to pay the state some time after the appeal period ends will not suffice. He objected that he could not be trusted.
Mr. James threatened to begin seizing Mr. Trump's assets to cover the judgment if Mr. Trump defaulted next week.
Alan Garten, a lawyer for the Trump Organization, said in a sworn statement included in Monday's filing that after Chubb came close to assuming the bond, he had “secured real estate against the defendants within the past week. “We have notified them that we cannot accept them as such,” he said.
