XL Group, a global insurance and reinsurance company, has sued hedge fund Level Global for $7.45m over charges of making misrepresentations when signing a $10m liability policy.

XL has filed a lawsuit in federal court in New York against hedge fund and co-founders Anthony Chiasson and David Ganek, and three others.

The group further alleged that in its 2010 application Level Global provided "false" answers and said that it was not aware of any situation that might provide a valid ground for a claim, as reported by Financial Times.

in November 2010, the Federal Bureau of Investigation raided Level Global’s offices and later found Spyridon Adondakis, a Level Global analyst as guilty of insider trading in April 2011.

Adondakis passed inside information from 2007 through 2010 about Dell’s 2008 earnings to Chiasson.

The SEC has also sued Level Global for making more than $70m in profits from the trades.