Tag Archives: Insurance News of Note

Direct physical loss in COVID Coverage cases: Are policyholders seeing a litigation shift in favor of COVID-19 coverage?

By Connor O'Carroll, Elizabeth Bowman and David E. Weiss on Posted in Business interruption, COVID-19, Insurance Coverage, Insurance General
The ongoing COVID-19 pandemic led to unprecedented closures and losses for businesses throughout the United States. Naturally, policyholders have sought recovery for pandemic-related losses under their “all risk” commercial property policies. According to the University of Pennsylvania Carey School of Law Covid Coverage Litigation Tracker, there have been approximately 2,300 of these COVID-19 coverage cases … Continue Reading

Lightening the load: New York Appellate Division rejects heightened pleading standard for policyholders seeking Bi-Economy Market consequential damages

By Ann Kramer, Paul Breene, John Berringer, Rich Lewis and Anthony B. Crawford on Posted in Insurance Coverage, Insurance General, Insurance News of Note
In a recent unanimous decision, the Appellate Division First Department provided clarity on the pleading requirements for policyholders seeking special or consequential damages allowed under the landmark decision of Bi-Economy Market v. Harleysville Insurance Company of New York, 856 N.Y.S.2d 505 (N.Y., Feb. 19, 2008). Under Bi-Economy, policyholders may seek special or consequential damages resulting … Continue Reading

Tangible property doesn’t have to be physically lost to find coverage

By David E. Weiss and Connor O'Carroll on Posted in Commercial General Liability, Insurance General
A California Court of Appeal recently held that the alleged loss of use of a premises as a nightclub qualified as “property damage” under a general liability insurance policy. Thee Sombrero, Inc. v. Scottsdale Ins. Co., 2018 WL 5292072 (Cal. Ct. App. Oct. 25, 2018). Thee Sombrero, Inc. (Sombrero) owned and operated a nightclub in … Continue Reading

Ten important steps a cannabusiness should consider when purchasing insurance

By Mike Sampson on Posted in Insurance Coverage, Insurance General
Purchasing insurance for a cannabusiness can feel like a daunting task, but it does not have to be one. In addition to grappling with many of the same issues and questions that any business confronts when seeking insurance, a cannabusiness encounters certain additional, unique challenges due to the industry in which it operates. That is … Continue Reading

Wisconsin Supreme Court’s misapplication of the pollution exclusion and disregard for policyholders’ business and purpose in purchasing insurance

By Mike Sampson and Caitlin Garber on Posted in Commercial General Liability, Insurance Coverage, Insurance General, Insurance News of Note
Last week, the Wisconsin Supreme Court issued two opinions in which it held that pollution exclusions barred coverage for third-party claims resulting from alleged contamination of water due to the seepage of cow manure and septage, respectively. As addressed in Chief Justice Shirley S. Abrahamson's dissents to the two decisions, the majority's opinions in both cases - Wilson Mutual Insurance Co. v. Falk, Nos. 2013AP691, 2013AP776, 2014 WL 7375656 (Wis. Dec. 30, 2014), and Preisler v. General Casualty Insurance Co., No. 2012AP2521, 2014 WL 7373070 (Wis. Dec. 30, 2014) - were faulty for a number of reasons.… Continue Reading

Reed Smith’s Insurance Recovery Group Ready to Help Policyholders after U.S. Congress Fails to Extend TRIA

By Doug Widin, Gary Thompson, Mike Sampson, Ann Kramer, Amber Finch and Kit Chaskin on Posted in Insurance Coverage, Insurance General, Insurance Insolvency & Regulatory, Insurance News of Note
Last week, the U.S. Congress adjourned for the year without making any provision for extending the federal Terrorism Risk Insurance Act ("TRIA"). Absent some sort of extension, TRIA thus will expire next week - on December 31, 2014. As a result, insurers will no longer be required to offer terrorism insurance, and even those insurers that do offer the coverage may well reassess their risk and price the coverage at substantially increased premium rates.… Continue Reading

You Can Assign Your Bad Faith Claims in Pennsylvania

By Luke Debevec on Posted in Insurance News of Note
This week, in a 5-1 decision resolving a certified question from the U.S. Court of Appeals for the Third Circuit, the Pennsylvania Supreme Court adopted the positions advanced by Reed Smith LLP on behalf of United Policyholders, concluding that policyholders are permitted to settle claims against them by assigning to plaintiffs and other claimants their rights to both statutory and common law-based bad faith claims against their insurance companies.… Continue Reading

Potentially Fraudulent Insurance Company Practices Are Exposed In Superstorm Sandy Litigation

By Jay M. Levin and Jennifer Katz on Posted in Insurance News of Note, Property Damage & Business Interruption
We recently marked the two year anniversary of Superstorm Sandy. With that anniversary came an influx of litigation in response to insurance companies denying or overly limiting coverage. That litigation recently revealed highly questionable practices within the industry.… Continue Reading

Deputy Secretary of Treasury Encourages Financial Institutions

By Courtney Horrigan and Caitlin Garber on Posted in Cyberliability, Insurance News of Note
Top-ranking U.S. officials continue to stress the importance of securing adequate protection in the event of cyberliability losses. Most recently, those efforts have been directed to financial institutions, an industry particularly susceptible to cyber attacks. On December 3, 2014, United States Deputy Secretary of the Treasury, Sarah Raskin, delivered a speech at the Texas Bankers' Association Executive Leadership Cybersecurity Conference wherein she provided banks with a simple checklist to consider before a cyber attack occurs. Notably, one item on the Deputy Secretary's checklist was cyberliability insurance - coverage at which the Deputy Secretary recommended all banks take a hard look.… Continue Reading

On the Coattails of United States v. Trek Leather, Make Sure You Have Suitable D&O Coverage

By Andy Moss and Stephen Winter on Posted in D&O, E&O, Professional Liability, Insurance Coverage, Insurance News of Note
Corporate directors and officers have a long list of things that can keep them up at night. Personal liability for civil fines and penalties arising out of negligence or even gross negligence committed in the course of their service to the company should not be one of them. But recently, in United States v. Trek Leather, Inc., 767 F.3d 1288 (Fed. Cir. 2014) (en banc), a federal appeals court held that the government could hold a corporate officer liable for a civil penalty based on gross negligence committed by the officer or his or her agents acting in the scope of their duties to the company, and without the government establishing fraudulent intent or attempting to pierce the corporate veil.… Continue Reading

As Federal and State Agencies Warn of Increased Cyber Threats, Insurance Incentives for Compliance with NIST Cybersecurity Framework May Be on the Horizon

By Andy Moss and Emily Garrison on Posted in Cyberliability, Insurance Coverage, Insurance News of Note
Since the President's February 2013 Executive Order directing the National Institute of Standards and Technology (NIST) to lead the development of a voluntary framework to address and reduce cyber risks, the agencies and stakeholders involved have been exploring whether to tie the February 2014 Framework for Improving Critical Infrastructure Cybersecurity (the NIST Framework) to incentives such as cyberliability insurance. For example, in a Report to the President on Cybersecurity Incentives, the Treasury Department suggested that "[c]yber insurance can promote adoption of stronger security measures" because, among other reasons, "insurers could require policyholders to comply with minimum security standards as a condition of insurance coverage, including adoption of the Framework." The Treasury Department held a public meeting on November 6 that included a discussion of developments in the market for cyberliability insurance and the NIST Framework.… Continue Reading

Predictable Responses to Benmosche Leak

By Ann Kramer on Posted in Insurance News of Note
This morning’s WSJ report that Robert Benmosche, recently appointed CEO of AIG, is unhappy with government pay restrictions, has elicited predictable, less than sympathetic responses. “Tiny Violins” is the headline from the Daily Beast.  New York Magazine’s Daily Intel responded with sarcasm: Apparently, someone told Robert Benmosche that running the world’s largest and most [expletive withheld] insurer … Continue Reading

When will the chickens come home to roost? Insurers Use Reserve Releases to Buff Up Underwhelming Financials

By Ann Kramer on Posted in Insurance News of Note
Releasing reserves based on early developments is an optimist’s view, [Evan Greenberg, chairman and chief executive officer of ACE Limited] said. “Good news comes early in the casualty business. The bad news always comes late,” he said. “I do think some companies have released reserves early in an effort to goose earnings,” he said. “It … Continue Reading

Insurers Wait for a Hard Market: If Only Wishing Could Make It So

By Ann Kramer on Posted in Insurance News of Note
P&C insurance companies are in a tough spot right now. According to a recently released Insurance Services Offices report, their margins have dropped below break-even.  Investment income has fallen through the floor, and the commercial mortgage backed securities market hasn’t even begun to take the hit that analysts predict it will. On top of that, premiums are shrinking, … Continue Reading

The Path of the Umbrella

By Ann Kramer on Posted in Insurance News of Note
As Travelers takes AIG’s spot in the Dow Jones Industrial Average, or rather Dow Jones Non-Industrial Average take a moment to check out the path of the iconic red umbrella as it passed from Travelers to Citibank (ironically, Travelers former parent also exiting the Dow) and back again.… Continue Reading
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