Policy Exclusions

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filesA couple of items crossed my desk last week that made me think about two exclusions that are sometimes found in D&O insurance policies. In each case, the exclusions, while relatively uncommon, could substantially restrict the insurance coverage available at least in certain circumstances. Precisely because these exclusions are relatively uncommon, it is important to understand the circumstances to which they apply and how they can affect coverage when they are triggered.
Continue Reading D&O Insurance: Thinking About Two Relatively Uncommon Exclusions

arizonaThough the Insured vs. Insured exclusion is a standard D&O policy provision, it seems to generate a disproportionate number of D&O insurance-related coverage disputes. The exclusion precludes coverage for claims brought by one Insured Person against another Insured Person. Among the host of recurring issues are the questions surrounding the exclusion’s preclusive reach when the claimants suing an Insured include both individuals who are Insured Persons and other individuals who are not Insured Persons.

These questions arose in a coverage dispute involving a series of lawsuits brought against the board of U-Haul International Inc. parent Amerco. One of the lawsuits had been brought by a former Amerco board member (who was also related by family to the company founder) but the rest of the lawsuits had been initiated  by other shareholders who were not Insured Persons under Amerco’s D&O insurance policy. The various actions were consolidated by court order. The company’s D&O insurer denied coverage for the board’s defense expenses based on the Insured vs. Insured exclusion. In a June 6, 2016 opinion (here), the Ninth Circuit affirmed the district court’s holding that the exclusion precluded coverage for all of the claims.
Continue Reading D&O Insurance: Thinking About the Insured vs. Insured Exclusion

tuneupThe private company management liability insurance environment is constantly changing. The liability environment is constantly evolving. Because of the changes in liabilities and exposures and because of the competitive nature of the insurance marketplace, the available terms and conditions are constantly changing as well. Unfortunately, all too often, some private companies simply renew their management liability insurance programs year after year, without ensuring that their policies contain the most up-to-date terms and conditions available. In order for companies assess whether their policies are current, I have listed some of the important items for companies to look for in their policies. I have added some additional comments below, as well.
Continue Reading Private Company Management Liability Insurance Tune-Up Tips

weilComplicated coverage issues frequently arise in connection with D&O claims, and that is particularly true with respect to claims arising in bankruptcy. In the following guest post, Paul Ferrillo and Ronit Berkovich of the Weil, Gotshal & Manges law firm take a look at the key D&O insurance considerations that companies heading into bankruptcy should keep in mind. I would like to thank Paul and Ronit for their willingness to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Paul and Ronit’s guest post.
Continue Reading Guest Post: Please Buckle Your Seatbelts and Check Your D&O Insurance: A Gloomy Forecast Is Ahead

dcctofappealsThe problems that can arise from the wording of the professional services exclusion in a service company’s D&O insurance policy are perennial issues and a recurring topic on this blog (see for example here). When the exclusion in a service company’s management liability policy is interpreted broadly the exclusion can sweep so extensively that it can preclude coverage for the very types of claims the management liability policy was intended to insure. A recent decision from the District of Columbia’s highest court highlights these concerns.

In a February 11, 2016 District of Columbia Court of Appeals decision (here), the appellate court, applying District of Columbia law, reversed a lower court ruling that the professional services exclusion in the management  liability insurance policy of defunct Carlyle Management LLC precluded coverage for the various claims that had been asserted against Carlyle, related entities, and its senior officials. The Court of Appeals did not affirmatively conclude that the underlying claims were covered; rather, it held only that the broadly worded professional liability exclusion was ambiguous, and that the question of coverage is properly a question for a factfinder. While the appellate court did not affirmatively find coverage, the court’s opinion underscores the concerns with interpreting and applying the professional liability exclusion in a service firm’s management liability insurance policy too broadly.
Continue Reading D.C. Appellate Court Reverses Ruling that Professional Services Exclusion Bars Coverage for Failed Investment Firm’s Claims

bob-bregmanThe exclusions are an important part of any liability insurance policy, but this is particularly true of cyber liability insurance polices. In the following guest post, Robert Bregman, CPCU, MLIS, RPLU, Senior Research Analyst, International Risk Management Institute, Inc., takes a look at the ten of the most common exclusions found in cyber liability and privacy insurance policies. This guest post is an excerpt taken from a longer article entitled “Cyber and Privacy Insurance Coverage” that appeared in the July 2015 edition of The Risk Report, and is copyrighted by IRMI. Learn more about The Risk Report here.

 

I would like to thank Bob for his willingness to publish his article on this site. I welcome guest post submissions from responsible authors on topics of interest to readers of this blog. Please contact me directly if you would like to submit a guest post. Here is Bob’s article.

 

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As is the case with virtually every type of management liability insurance, the true extent of coverage that any given policy provides is a function of its exclusionary language. Accordingly, this article will analyze both the differences and similarities between 10 of the most common exclusions found within cyber and privacy policies. Its goal is to assist the reader in negotiating exclusionary wording that maximizes the scope of coverage a policy will provide in the event of a claim.
Continue Reading Guest Post: Cyber & Privacy Policy Exclusions: Analyzing Differences, Negotiating Modifications

paUnder which claims made D&O insurance policy is there coverage for a claim that was filed under seal years ago but not served on the policyholder until the policy period of the current policy? If you find the answer “no policy” as unsatisfying as I do, read on. In a September 15, 2014 opinion (…