HOUSTON—The Houston Astros and CIGNA Corp. have reached a confidential settlement of a lawsuit filed against the insurer for denying a $15.6 million claim related to an injury suffered by first baseman Jeff Bagwell.

In a lawsuit filed in April, the baseball team alleged that the insurer wrongfully denied coverage from an insurance policy purchased by the team to cover the Astros if Mr. Bagwell were to become totally disabled. The team filed a claim for approximately $15.6 million in January, saying an injury to Mr. Bagwell's right shoulder left him totally disabled. However, CIGNA denied the claim in March.

"The Houston Astros and Connecticut General Life Insurance Co. have reached an amicable resolution of the lawsuit brought by the club relating to the total disability policy on Jeff Bagwell," the organizations said in a joint statement.

The parties were taking depositions when they agreed to resolve the lawsuit, said Wayne Fisher, a partner with Houston-based Fisher, Boyd, Brown, Boudreaux & Huguenard L.L.P., who represented the team in the dispute. The suit will be dismissed, probably within the next few days, and both parties are glad they have been able to resolve the suit, he said.

A key part of the dispute arose from the fact that Mr. Bagwell, who had surgery on the shoulder in June 2005, played at the end of the regular baseball season and in the playoffs in September and October 2005.

In the policy, total disability would mean Mr. Bagwell's complete and total physical inability to participate in baseball activities. CIGNA argued that his injury prevented him from throwing, but did not prevent him from hitting, said Ty Buthod, a partner with Houston-based Baker Botts L.L.P., who represented Connecticut General Life Insurance Co., the legal entity of Philadelphia-based CIGNA.

In what Mr. Fisher described as a coincidence, Mr. Bagwell announced his retirement the day after the settlement was reached, saying that his ailing right shoulder left him unable to continue playing professional baseball.

During a press conference Friday, Mr. Bagwell said he knew in spring training this year that his career was most likely over because he was unable to participate in workouts. He contemplated more shoulder surgery, but decided it was not worth the risk because there was only a 20% chance of success, he said.

"I knew my time was done," Mr. Bagwell said, adding that "the injury factor took a lot out of me."