Tag Archives: Insurance Coverage

Don’t Forget About D&O Insurance When The Government Subpoena Arrives

By Paul E. Breene and Mark S. Hersh When an investigation is commenced by a federal or state government entity, whether by service of a subpoena or by less formal means, a company should have two standard operating procedures: first, hire excellent and experienced counsel to respond to the investigation or subpoena, and second, determine whether … Continue Reading

Answers To The Most Common And Perplexing Questions About Professional Liability Coverage

Reed Smith partner Tom Marrinson, resident in the firm’s Chicago office, has been advising policyholders about their insurance coverage, and representing them in coverage litigation, for more than 20 years. While Tom’s experience ranges widely, he has literally written the book on insurance coverage for professionals and companies that employ them Professional Liability Insurance, published … Continue Reading

Bond Insurer FGIC Ordered To Stop Writing Policies and To Cease Paying Claims; ISDA Announces FGIC ‘Failure to Pay’ Credit Event

This post was written by David Schlecker and Andrea Pincus. 3rd Quarter Financials Lead to Action By NYS Superintendent of Insurance and ISDA On November 24, 2009, Financial Guaranty Insurance Company (“FGIC”), a New York- domiciled monoline financial guaranty insurer, was ordered by New York’s Superintendent of Insurance to cease writing any new policies and to … Continue Reading

Pushing Back on Insurance Coverage Denials for Sexual Abuse Claims

It has become routine in the past ten years or so for liability insurance companies to deny insurance coverage for sexual abuse claims, often on the theory that sexual abuse is intentional in nature. Many liability insurance policies commonly adopt the definition of “occurrence” which requires that a claim must arise from an “accident.” Under these policies, … Continue Reading

NY High Court Holds that “Self-Serving” Testimony from Underwriter is Insufficient for Rescission

The New York Court of Appeals rejected an effort by Continental Casualty Company (CNA) to rescind an excess professional liability (E&O) policy issued to the law firm Pepper Hamilton LLP, in a decision under Pennsylvania law that also affirmed summary judgment in favor of two of the firm’s other excess E&O insurers based on the … Continue Reading

Delaware Chancery Court Opens the Door to “All Sums” Allocation in New York

On October 14th, Vice Chancellor Leo E. Strine, Jr. of the Delaware Court of Chancery blew some much needed fresh air into New York allocation jurisprudence. The Viking Pump consolidated cases, C.A. 1465-VCS, have already yielded very interesting and thoughtful rulings on the transfer of insurance in connection with complicated corporate transactions. Viking Pump, Inc. v. Liberty … Continue Reading

Insurance Company Pays Up, Resolving Unallocated Settlement and Defense Costs

On August 13, 2009, the City of Sterling Heights, Michigan received a check from United National Insurance Company for over $15.4 million, satisfying a judgment awarded by the federal district court for the Eastern District of Michigan and upheld on appeal by the Court of Appeals for the Sixth Circuit.  Apart from this payment, United National … Continue Reading

A Flush Beats a Straight and Excess Other Insurance Beats Pro Rata Other Insurance

W9/PHC Real Estate LP and Grubb & Ellis Management Services, Inc. v. Farm Family Casualty Insurance Co., N.J. App. Div. May 20, 2009 In a declaratory judgment action presented to the New Jersey Appellate Division, defendant Farm Family Casualty Insurance Company (Farm Family) appealed from an order directing it to reimburse W9/PHC Real Estate LP … Continue Reading

Travelers v. Bailey

Yesterday, the United States Supreme Court handed a win to Travelers (and indirectly to chapter 11 debtors using insurance proceeds to fund bodily injury trusts), getting Travelers out of further liability arising from its actions “related to” its role as the primary insurer of Johns-Manville. These were not suits seeking proceeds of the insurance policies issued … Continue Reading

Have NJ Court Rules, Will Travel: NJ Court Holds Insurer Must Pay Counsel Fees Incurred in Illinois Declaratory Judgment Action

On June 5, 2009, in response to the appeal filed by Myron Corporation, a New Jersey appellate court held that Atlantic Mutual Insurance Corp. was responsible for Myron’s counsel fees incurred in fending off Atlantic’s Illinois declaratory judgment action pursuant to NJ Rule 4:42-9(a)(6). The coverage dispute centered on defense coverage for numerous cases filed against … Continue Reading

What Obama’s Proposed Financial Regulatory Reforms Mean for Insurance — The New Office of National Insurance

On June 17, 2009, the Department of the Treasury released its “white paper” detailing proposals for comprehensive reform of financial industry regulation, entitled “Financial Regulatory Reform, A New Foundation: Rebuilding Financial Supervision and Regulation.” The entire report can be found here. Among the reforms advocated by the Treasury Department is the creation of an Office of National … Continue Reading

Third Circuit Misses the Mark in CPB International

Recently, the Court of Appeals for the Third Circuit decided Nationwide Mutual Insurance v. CPB International, Docket No. 07-4772 (April 14, 2009). CPB supplied chondroitin to Rexall for use in compounding tablets, including chondroitin and glucosamine. CPB supplied two batches of chondroitin that turned out to fall short of contractual specifications and to contain impurities. By the time … Continue Reading

2003 Blackout Held to Involve ‘Property Damage’ Sufficient to Support Claim Under Property Policy

On April 22 , 2009, the Appellate Division of the New Jersey Superior Court published its March 9, 2009 opinion holding that the massive Aug. 13, 2003 electrical blackout of the eastern United States and portions of Canada inflicted “property damage” sufficient to support a property insurance claim. The court held that the loss of functionality that … Continue Reading

The Future of Monolines?

Felix Salmon reads the tea leaves left by Warren Buffet and concludes that the already disastrous monoline situation is unlikely to improve any time soon. Money quote: Given all these reasons to buy bonds rather than insure them, I do wonder what’s going to happen to the monoline market. Historically, it’s been a license to print … Continue Reading

Who Was Minding the Store?

For those of you interested in the role of regulators in the implosion of AIG [see prior posts Here and Here,] Planet Money (an award-winning joint project of NPR News and This American Life) had a fascinating program this past weekend: “The Watchmen”. Although it has already aired, it is available to listen to on-line or for … Continue Reading

A Quick and Dirty Guide To London Insurance Arbitrations

A dozen years after asbestos and environmental liabilities of U.S. companies led to the downfall of Lloyds’, London is again in the center of the liability insurance world—this time as the location for many insurance arbitrations over coverage for product and toxic tort liabilities. Foreign insurers insist upon arbitrating coverage disputes in London to avoid having … Continue Reading

AIG Hardball?

Bloomberg News yesterday carried a report of a court filing alleging that AIG reported a claimant to Homeland Security in order to avoid paying a verdict that now amounts, with interest, to $3 million. The worker, Aleksander Janda, was arrested today on charges related to using someone else’s Social Security number, including identity theft, said Helen … Continue Reading

A Tale of Two Evidentiary Standards

This post was also written by Michael N. DiCanio. Policyholders and their counsel should check out a May 27 ruling denying summary judgment to the insurance company defendants in Bray & Gillespie IX, LLC v. Hartford Fire Insurance Co., et ano. In the B&G decision, a magistrate judge in the Middle District of Florida relied in … Continue Reading

The Equitas-Speyford Deal: The Train (Destination Solvent Scheme) is Leaving the Station

By now most of us have received notices of the Equitas-Speyford Part VII transfer. A court hearing to approve the transaction will take place in London on June 24th and the transaction is to take effect on the 30th of June. The letter asks policyholders to set forth any objections by June 9th: “If you intend to … Continue Reading

Eric Dinallo Resigns

On May 28, Eric Dinallo, New York’s high-profile Superintendent of Insurance, resigned effective July 3. Dinallo presided over the Department’s response to the AIG catastrophe and advocated far more regulation of the industry than previously seen. Dinallo was also instrumental in the rescue of the municipal bond business in New York, approving segregating it from … Continue Reading
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