Home Construction CNA demands more insurance premiums from Mount Vernon contractor

CNA demands more insurance premiums from Mount Vernon contractor

CNA Financial Corp. is demanding $834,458 from a Mount Vernon construction company for allegedly paying only a small portion of its insurance premiums.

Three subsidiaries of Chicago-based CNA accused PCI Industries Corp. and owner Richard Persico of fraud, unjust enrichment and breaches of contract in a complaint filed June 4 in U.S. District Court, White Plains.

CNA claims Persico and PCI “never intended to remit payment for the additional premiums owed.”

PCI offers a variety of construction services, according to its website, such as excavation and road paving. It has worked on many government jobs for New York State, New York City and municipalities throughout Westchester County.

The construction company took out two general liability policies and a business auto policy with CNA insurance companies from 2017 to 2018, according to the complaint, but paid only a portion of the required premiums.

In 2017, for instance, the initial premium for a general liability policy was $114,160, based on information provided by PCI. After the policy expired, CNA audited PCI and concluded that the company owed an additional $468,904.

PCI paid $161,225, leaving a balance of $421,839.

CNA claims that PCI still owes $775,616 on the three insurance policies.

For 12 months from mid-2019 to mid-2020, Persico and a PCI attorney negotiated with CNA to settle the debt, according to the complaint.

Several times, CNA claims, both sides agreed on the terms of a $834,458 promissory note, but each time PCI failed to return an executed copy of the note.

The PCI attorney allegedly “made intentional misrepresentations” that the company “would remit payment for the audits and additional premiums owed under the policies,” but PCI has failed to make any payments.

The attorney is not named as a defendant in the complaint.

Persico, of Yonkers, did not immediately respond to a request for comment, and an attorney representing PCI declined to comment on ongoing litigation.

CNA is represented by Manhattan attorney Dennis E. Kadian.

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