In general, and at least in the United States, executives at public companies don’t need to be convinced that their companies need to have D&O insurance. That is not always true with officials at private companies. Some officials at some private companies – particularly very closely held private companies – are skeptical that they need
Guest Post: Dispelling the Myths of Side A Directors and Officers Insurance
Many insurance buyers now regularly include a separate component of Side A insurance as part of their D&O insurance program. However, even though it has become an increasingly common part of many companies’ D&O insurance programs, Side A D&O insurance is not always fully understood. In the following guest post, Robert F. Carangelo and Paul
D&O Insurance: Settlement of Antitrust Claim for Underpaid Wages Not Excluded “Disgorgement”
A settlement of an antitrust lawsuit alleging that a group of hospitals conspired to underpay their nurses did not represent excluded “disgorgement” and therefore was not excluded from coverage under William Beaumont Hospital’s management liability insurance policy, according to a January 16, 2014 Sixth Circuit decision. The opinion will likely be of particular interest to
Kiwi Supreme: Claimants’ “Charge” on D&O Insurance Blocks Payment of Directors’ Defense Costs
In a December 23, 2013 ruling that will be surprising and unwelcome to D&O insurers and their insureds in New Zealand (and perhaps elsewhere) , the New Zealand Supreme Court has reversed the holding of an intermediate appellate court and ruled that, by operation of a statutory “charge” on insurance in favor of third party
D&O Insurance: Health Care Organizations Face Increasing Rates, Tightening Terms
Largely as a result of changes in the industry following the enactment of the Affordable Care Act, health care organizations have seen their D&O insurance rates increasing and the available terms and conditions tightening, according to a December 10, 2013 report from Marsh. Moreover, these changes are likely to continue in 2014, according to the
Reps and Warranties Insurance: Multiple-Based Damages Claims
The purchase of reps and warranties insurance is an increasingly common element of mergers and acquisitions transactions. But while the uptake of reps and warranties insurance has increased, concerns remain about how a reps and warranties insurance will respond if a claim arises based on an allegation that a seller has breached a financial statement
D&O Insurance: Professional Services Exclusion Precludes Coverage for Claims Arising From Broker-Dealer’s Offering Underwriter Activities
On November 21, 2013, in a terse, two-page summary order (here), the Second Circuit affirmed a district court ruling applying New York law and holding that a D&O insurance policy’s professional services exclusion precludes coverage for claims brought against broker-dealer David Lerner Associates, based on the firm’s offering underwriter and financial products sales
More About D&O Insurance and Bankruptcy
Although D&O insurance represents an important risk management tool for every company, the protection that a D&O insurance policy affords directors and officers is particularly important in the bankruptcy context, when the company is no longer able to indemnify the individuals. Yet, as industry practitioners know, a number of issues recur in the bankruptcy context
D&O Insurance: Known Circumstance Exclusions
D&O insurance policies often address a policyholder’s particular circumstances. One way that D&O insurers sometimes address the fact that a company has experienced adverse circumstances is to incorporate into its policy a “known circumstances exclusion” precluding coverage for those circumstances. In an October 23, 2013 opinion (here), the First Circuit affirmed the opinion
More About the D&O Insurance Implications of the SEC’s New Admissions Wrongdoing Requirements
Numerous questions surround the SEC’s new policy requiring enforcement action defendants in “egregious” cases to admit to wrongdoing in order to settle with the agency, rather than simply agreeing to neither admit nor deny the agency’s allegations. As I discussed in a prior post (here), among the questions is the issue of what