Your company pays the premiums – but is it collecting insurance dollars when it counts the most?

2011 has been a year filled with global natural disasters, marked earlier by the Japan earthquake and more recently by the Thailand flood. These events are continuing to have financial consequences for companies around the globe with facilities, trading partners or clients in the impacted regions.

[via: Litigation: 5 strategies for collecting maximum insurance dollars at InsideCounsel]

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A new policy from the Chubb Group of Insurance Companies helps protect the personal assets of in-house attorneys. Inhouse counsel insurance is something law departments should look into and discuss with their corporate risk managers – especially as in-house counsel are increasingly becoming targets in litigation and governmental investigations:

Employed Lawyers Professional Liability by ChubbSM offers in-house attorneys and their employers broad protection against allegations of legal malpractice stemming from the services provided by in-house counsel for activities such as the review of shareholder communications and the issuance of legal opinions to the board of directors. Coverage is provided for judgments, settlements and defense costs. It also extends to civil penalties leveled against in-house counsel under the Foreign Corrupt Practices Act.

[via Chubb Helps Protect In-House Attorneys from Allegations of Malpractice.]

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Knowing your insurer’s defense duty can help increase the value of their insurance.

[via: 5 tips to maximize insurance coverage for legal fees at InsideCounsel]

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The constant escalation of cybercrime may be falling far too close to home for law firms and corporate counsel, who are beginning to shop for (or at least ask a lot of questions about) cyberinsurance.

[via: Is Cyber-Insurance Necessary? at CorpCounsel]

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Time to dust off your EPLI policy and give it a close read – as an EEOC suit may not be covered under the policy language.

[via EEOC suit may not be covered by EPLI policy at Jottings by an Employment Lawyer.]

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Corporate counsel are often called upon to deal with insurance issues – whether as part of day to day business operations, drafting agreements or dealing with brokers and carriers for the companies they serve. Unfortunately, insurance is one of those areas (like tax, ERISA, and the Jets’ inability to get back into the SuperBowl – fingers crossed) that is often hard to understand. Fortunately, there are those who are trained in the insurance arts and who are able to communicate insurance issues in writing effectively. Vincent E. Morgan of Pillsbury Winthrop Shaw Pittman LLP is one such individual, and he has graciously provided InhouseBlog with a copy of An Insurance Primer, which was presented at the Fundamentals of Insurance Law conference in Dallas, Texas in 2010. It is an easy to read document and one that can help in-house counsel get up to speed on insurance law and issues. Enjoy!

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Think malpractice insurance is only for attorneys in private practice? Think again. The Hartford recently launched an insurance package that can help cover risks for in-house attorneys. Read on for more information about the areas of coverage – and don’t forget to read a prior post on the issue.

The Hartford Financial Services Group, Inc. now offers a professional liability policy specifically for staff attorneys. The Hartford Employed Lawyers Choice Liability PolicySM is designed for small and midsize companies looking to provide comprehensive coverage for their in-house counsel.

“In-house attorneys can face lawsuits stemming from a variety of areas, including employment practices, contract drafting, mergers and acquisitions. Lawsuits due to errors in those areas can result in significant defense costs and settlement payments,” said Will Demers, director of financial products underwriting for The Hartford. “We designed this policy to address gaps in coverage for these types of exposures, which can be substantial for staff attorneys who aren’t protected with a liability policy.”

[via New Liability Policy From The Hartford Protects In-House Attorneys ]

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Did you leave insurance coverage off of your list of resolutions for the New Year? Well consider this a reminder, and thanks to Susan Friedman of the New York Law Journal, you’ve got a quick way to get up to speed:

In the face of a myriad of new and existing exposures, potential corporate insolvency, personal liability and regulatory road rage, a separate stand-alone insurance policy for in-house counsel has gained appeal. This article highlights the mechanics of a standard insurance policy for in-house counsel, commercially known as employed lawyers professional liability insurance or employed lawyers policies. It also discusses key provisions — included under “Travel Tips” — that are commonly found in the most comprehensive employed lawyers policies.

Read more of Road Map for In-House Counsel Insurance Coverage at Law.com.

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Jonathan M. Cohen and Kami E. (of Gilbert Randolph LLP) have published an article in the Corporate Counselor that should prove helpful to in-house counsel dealing with potential consumer protection claims – and they do a great job of dissecting and explaining related insurance issues:

Companies in virtually every sector of the economy have become targets of allegations that their business practices or products have injured consumers. These cases often arise as class actions, frequently exposing target companies to the risk of significant defense costs, liability, or a product recall. In the face of the ever-increasing risk of consumer protection claims, most companies have put into place risk management strategies that principally rely on a variety of insurance policies. All too often, though, when a company needs its insurance most, it finds that it does not get the protection that it expects. Instead, insurers frequently make every effort to evade payment under their policies.

Protecting Your Company From Consumer Protection Claims

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Farella Braun & Martel LLP report on a recent California case that sheds light on the tricky world of "additional insured" status.  If you draft services agreements that benefit your company, you know that being an "additional insured" can provide your company with additional protection in the event of a covered loss – but you probably aren’t aware that there are often a number of hoops that you must jump through to get your company the protection it needs.

"The concept of Additional Insured status has always been better than the practice: because of carelessness in the issuing process, vague and undefined terms used by carriers, and sometimes unrealistic expectations of insureds (including the want-to-be Additional Insured), confusion and lack of coverage have often turned out to be the order of the day. Now a recent California Court of Appeals case has added yet another wrinkle – and another way that the legitimate expectations of an Additional Insured might be unfulfilled. The case of Gorham v. First Financial Ins. Co., 2006 DJDAR 6683 (filed May 30, 2006), highlights an interesting twist that could impact an entity that expects to be added as an additional insured on another’s CGL policy."

Link: Protecting Your Status As An Additional Insured from Mondaq (free registration required).

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"Claim frequency and claim values are going up for directors and officers of corporations, but insurance premiums are going down, coverage terms are getting broader, limits are increasing, and retentions are constant or decreasing. This is one of the findings in the most recent report from Tillinghast/Towers Perrin. As the report states, it “seems counterintuitive that there is a decrease in the excess premium given the increase in excess limits and increasing claim severity.” Premiums decreased by 8 percent in Tillinghast’s survey (downward pressures confirmed by others) compared to last year’s survey of some 2000 survey participants, with average limits being $14.3 million. And 25 percent of US participants reported increased enhancements to their coverage terms and another 10 percent reported narrowing of exclusions. The principal markets for this insurance in the US are provided by Chubb and AIG, with other players trying to gain market share in different segments, such as Beazley."

Link: Insurance Scrawl: What a Director (or Officer) Wants: A Guide for Insureds to the Wordings of D&O Policies.

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Have a close relationship with your insurance broker? Great – but don’t get too chummy – as a recent post at the InsuranceScrawl points out:

"Policyholders often assume they have a confidential relationship with their insurance brokers. Not so.

Communications with or by brokers can become unwelcome pieces of evidence in insurance-coverage cases. Brokers have not been schooled in the need to recognize that their communications constitute evidence, for good or ill. Broker communications often are unhelpful in coverage cases because (with due respect): (i) brokers are not lawyers and so sometimes make casual, overly broad or unduly fuzzy statements about what’s covered or not; (ii) brokers don’t keep up with changing insurance-coverage law in every jurisdiction and the cutting-edge of coverage disputes; and (iii) brokers suffer from bureaucratic capture (that is, bend toward the thinking of insurance carriers). Most courts hold that insurance brokers are agents of the insured, rather than being true neutrals in a transaction, so insurance-company lawyers will argue that infelicities in broker correspondence should be deemed agent-admissions against the insured."

Link: Insurance Scrawl: Your Broker May Be Your Friend – But Ain’t Your Lawyer.

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Grant Buckler has an article at Globeandmail.com that highlights the availability of insurance for data related losses.  As our economy is becoming increasingly dependent on electronic and data related goods and services, companies need to make sure that they have appropriate insurance coverage and security mechanisms in place.  Read the article below and call your carrier to get the ball rolling.

Link: The Globe and Mail: Can you afford to lose your data?. Tip of the hat to Rob Hyndman for the link.

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Canadian law firm Clark Wilson LLP has posted on an informative article on insurance issues in the construction context:

"In construction, whether you are a developer, an architect, an engineer, a contractor, a subcontractor, or a project manager, you may incur liability when doing your work. Liability in the context of a construction project is typically substantial. As such, carrying liability insurance becomes a practical necessity for your business and one way to manage your risk. In some cases, liability insurance is a requirement under the contract.

Once you have made the decision to purchase liability insurance, trying to decide on which liability policy to purchase, how much insurance to obtain and for how long can be an intimidating process. The purpose of this article is to provide the reader with some practical advice and suggestions on this important but potentially complicated process."

Link: Clark Wilson LLP’s Legal Framework – August, 2005.

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Has your business been impacted by Katrina? Even if your business is not located in the Gulf Coast, your insurance policy may afford coverage for certain “contingent” losses, as Marc Mayerson of InsuranceScrawl points out:

“Businesses lucky enough to be located outside of Katrina’s wrath still are exposed to losses from the hurricane: while they may not have suffered physical losses to their assets, their suppliers or customers, or both, may have been damaged. As a result, these “unaffected” businesses may have coverage for their own economic losses stemming from Katrina.

An increasingly common add-on to coverage in recent years has been “contingent” business-interruption coverage (or contingent business-income coverage). These policies are limited in what types of event triggers their coverage: typically, only those hazards that are insured against with respect to the insured’s own assets qualify as covered events when they befall the insured’s supplier or the insured’s customer.”

Link: Insurance Scrawl: Businesses Far from Katrina May Have Insurance Claims.

Don’t forget to check out InhouseBlog’s earlier post on the topic of contingent business interruption insurance.

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William F. Campbell of DLA Piper Rudnick Gray Cary has published an informative article on insurance issues in the information age – not bad to read in preparation for your next insurance audit?

"Traditional insurance policies are well designed to cover slips, falls, and fires. But are these the greatest risks businesses face? Dependence on technology, networked computers and the Internet has redefined risk for many businesses. Networked computers hold financial data, sensitive customer information, trade secrets, and proprietary software systems and databases. They also are essential communications channels. Traditional insurance policies, however, are not designed to provide protection for the risk environment that surrounds today’s business technologies. To fill the gap that traditional policies leave, the insurance industry offers a new generation of flexible and evolving products that prudent insurance buyers should consider."

Link: DLA
Piper Rudnick Gray Cary – United States – Do Your Insurance Policies
Cover 21st Century Risks? (08/08/2005) from Mondaq (free registration
required).

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Interested in Directors and Officers liability insurance coverage issues ? It’s one of the hottest topics these days on the minds of executives and they companies they work for.  John Doernberg has created a new blog that should help you keep abreast of the latest news and trends.  In his own words:

"I have created this blog in order to share thoughts and ideas with others who are interested in making directors and officers liability insurance coverage as broad and effective as possible. D&O insurance is a complex and ever-evolving subject, and keeping current requires careful thought, research and the sharing of ideas and experiences. My intented audience is risk managers, lawyers, corporate directors, CFOs and others with a professional or personal interest in protecting directors and officers. By way of background, I practiced corporate law for 12 years at major New York and Boston firms before changing careers and becoming a D&O insurance broker in 1995."

Link: Doernberg’s D&O Insurance Blog.

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Our buddy Kevin Heller over at the Tech Law Advisor blawg points to InsuranceScrawl, a blawg about insurance law published by Marc Mayerson, a partner at Spriggs & Hollingsworth in Washington, D.C. – it might be an interesting read if you deal with insurance law issues at your company.  Don’t forget to sign up for the Tech Law Advisor feed (XML)!

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If you are like most corporate counsel, you’re happy to refer all insurance-related issues to your carrier or, better yet, to your company’s insurance department. Insurance law is highly complex and insurance policies are about as fun to read as treatises on the feudal tenures. With this in mind, we’ll keep our insurance postings as pithy as possible.

Today’s posting is on “contingent business interruption insurance” – a veritable mouthful of insurance verbiage. Fortunately, Alan R. Miller of the Boston office of Robins, Kaplan, Miller & Ciresi LLP has provided a highly informative article on the topic that is a must-read for all in-house counsel. Basically, contingent business interruption insurance can protect your company’s earnings in the event of a loss or physical damage to the property of your company’s suppliers or customers. Many companies are heavily dependent on raw materials from key suppliers to make the products they sell to consumers. What happens if the supplier suffers a loss and cannot continue to make deliveries? If you do not have contingent business interruption insurance you may be out of luck. Read Alan’s article today and get informed – then touch base with your insurance department and/or carrier to make sure that your company has the coverage and limits it needs to protect its financial future.

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