Reinsurance industry sees rough times with the top reinsurer Deloitte & Touche LLP facing a potential $2 billion legal claim involving its audits of California-based insurer Fortress Re.

Aviation risk reinsurer Fortress bankrupted after Sept. 11, 2001, terrorist attacks and led to two Japanese insurers that relied on it faced total losses of $3.5 billion and one company went bankrupt. Fortress in fact relied on financial reinsurance despite of telling to the companies it had obtained insurance that would cover losses on their (companies’) policies, Japanese casualty insurers say.

Now Japanese insurers ask why the liabilities related to the loan-type of insurance weren’t being recorded. But Deloitte is expected to argue that the Japanese insurers knew about the use of the loan-type of insurance with the following advantages as they opened claims.

This is not all for the claim against the reinsurance giant as the company may also be charged for its activity with Italian Parmalat and Adelphia Communications.

Despite of the fact that a previous year case was called "a life and death situation" for Deloitte by the defense attorney Robert S. Bennett, the company said it was sure to win this case.