CHICAGO — CIFG Assurance North America Inc. on Monday sued Assured Guaranty Corp., charging it with breach of contract violations for reneging on its obligation to cover the policy on $83.3 million of Xenia Iowa Rural Water District bonds as part of its 19-month-old reinsurance agreement.

The lawsuit — filed in New York State Court in Manhattan — followed Assured’s refusal to cover a shortfall in debt service owed to Xenia bondholders on June 1. CIFG honored the claim to make up the $69,000 shortfall in the $1.88 million interest payment.

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