Recent Posts
Follow Us
twittergoogle_pluslinkedinrssyoutube
The Legal Stuff
BT Policyholder Protection Blog
0 0

13 Mar 2015 Should Retailers Rely On CGL Coverage For Data Breaches?

In the past year, multiple cases have disputed whether commercial general liability insurance policies provide coverage for lawsuits related to data breaches and data privacy incidents. At least two matters are on appeal. The question of whether there is CGL coverage for those lawsuits is quite significant, particularly to retailers that have suffered data privacy incidents involving payment cards (i.e., credit and debit cards). CGL coverage can provide overlapping coverage with cyberinsurance policies, if not its own independent coverage, and defense costs under CGL policies frequently do not erode policy limits.   As a starting point, standard-form CGL policies provide coverage for all sums that an insured is liable to pay as damages because of bodily injury, property damage and personal and advertising injury. Bodily…

READ MORE
0 0

06 Mar 2015 3 TIPS FOR COMPANIES EVALUATING INSURANCE COVERAGE IN MERGERS AND ACQUISITIONS

Insurance policies are a significant asset that must be considered in any merger or acquisition. As companies are acquiring or merging with another company in 2015, there are three insurance-related tips for companies to keep in mind.   Value insurance policies As companies consider whether to acquire another company and its liabilities, it is crucial to value the insurance policies that may cover these liabilities.   An acquiring company should request the target company’s insurance policies (both historic and current), loss history reports and pleadings and motions from any litigation involving the target company early in the transaction process. A target company may be entitled to coverage under its own insurance program or programs of additional companies that are or were part of the target…

READ MORE
0 0

02 Mar 2015 Scott Godes Quoted in Advisen’s Cyber Risk Network Weekly Download

Scott Godes, from Barnes & Thornburg’s Policyholder Insurance Recovery Group, was recently quoted in Advisen‘s Cyber Risk Network Weekly Download’s article, “As technology expands, so does liability.”   As technology evolves, hackers are finding new ways to exploit vulnerabilities and organizations could face liability for failures in the security of their products or privacy violations due to them.   Insurers should “write broader policies,” to reflect the changing technological environment, according to attorney Scott Godes. “If you’re going to sell a policy to a company, you want to give them true peace of mind. Policies should be sufficiently elastic to encompass this changing landscape, rather than trying narrowly tailor what you’ll offer based on what you’ve seen in the past few years.”   Read more…

READ MORE
0 0

26 Feb 2015 Five Tips for Building a Better Insurance Coverage Tower

Insurance coverage cases from 2014 have illustrated a disturbing trend: excess insurers are continuing to take aggressive coverage positions and are increasingly unwilling to let the scope of their coverage be dictated by the terms of the primary policy or the coverage decisions of the primary insurer. Thus, if there was ever a time when policyholders could afford to simply assume their primary and excess policies would operate together to provide an uninterrupted tower of coverage, that time has passed. Today more than ever, policyholders would be well advised to work with their brokers or experienced coverage counsel to carefully review the coverage forms of their excess policies to try to identify and eliminate potential gaps between layers and shortcomings in the excess coverage.  …

READ MORE
0 0

24 Feb 2015 Scott Godes Quoted in Business Insurance

Scott Godes, from Barnes & Thornburg’s Policyholder Insurance Recovery Group, was recently quoted in Business Insurance’s article, “Increased Cyber Losses Means More Insurance Coverage Disputes.”   The article states that companies seeking coverage for data breaches under general liability policies often have turned to the personal and advertising injury part of the forms, and disputes have centered on whether a breach constitutes a “publication” that violated a right to privacy.  Beyond disputes regarding coverage under general liability policies for cybersecurity claims, lawyers anticipate coverage litigation arising under cyberinsurance policies as well.   Many of these lawsuits are litigated off the radar, and have not drawn widespread attention.  Some might suggest that cyberinsurance carriers probably want it that way.  Scott, who has litigated the scope of…

READ MORE
0 0

18 Feb 2015 RECENT CASE LAW ILLUSTRATES IMPORTANCE OF WORDING FOR “FINAL ADJUDICATION” REQUIREMENT IN D&O EXCLUSIONS

Directors and officers and management and professional liability policies generally contain so-called “conduct exclusions,” which exclude coverage for deliberate fraud, willful violation of a statute, the gaining of a profit to which the insured was not entitled and similar conduct. Most policies today, however, require a “final adjudication” for these exclusions to apply. Disputes frequently arise between insureds and insurance companies about what constitutes a final adjudication and what that adjudication must contain to exclude coverage.   Several courts have held that a settlement does not constitute a final adjudication within the meaning of these exclusions. For example, in U.S. Bank N.A. v. Indian Harbor Ins. Co. (D. Minn. Dec. 16, 2014), a federal court in Minnesota applying Delaware law held that coverage was not…

READ MORE
0 0

13 Feb 2015 Eleventh Circuit Decision Epitomizes the Differing Standards of Justice Received by Insureds in State Versus Federal Courts

The unpublished opinion of the Eleventh Circuit in Wellons Inc. v. Lexington Insurance Company 2014 WL 1978412 (11th Cir. 2014) is yet another federal court decision which ignores the insured’s substantive insurance rights under state law. The great divide between “State Court Justice” and “Federal Court Justice” continues to widen and thereby frustrates our constitutional system.   In Wellons, the Eleventh Circuit was asked to decide whether a series of prior, general reservation of rights letters by Lexington (AIG) preserved Lexington’s right to deny coverage after a lawsuit was filed and Lexington undertook the defense. The Wellons claim involved the construction of a dryer energy thermal oxidation system to produce heat for production of oriented strand board (OSB), customarily used in home construction and flooring….

READ MORE
0 0

04 Feb 2015 Insurance Company Favorite: The “Loss Adjustment Expense”

As you’re evaluating your company’s liability insurance program for 2015, consider closely the application of the policy’s deductible.  Specifically, take a look for any endorsement that defines “Allocated Loss Adjustment Expense,” or “ALAE,” to make sure the language matches up with what you think you are purchasing.   Liability policies are usually sold with some form of deductible, which remains the policyholder’s obligation in the event a claim is asserted against the policyholder. In assessing its risk tolerance, an insurance purchaser may buy policies with higher or lower deductibles. The deductible applies to the insurance company’s obligation to indemnify for claims asserted against the policyholder.  But most often, it does not apply to the costs of defense. In other words, the defense obligation purchased by…

READ MORE
0 0

28 Jan 2015 2014 Year in Review

On Tuesday, Jan. 27, Barnes & Thornburg insurance recovery attorneys presented on 2014’s major legal developments and trends in insurance coverage and recovery. Approximately 145 people joined the webinar and learned more about how past events affected:   Directors and Officers (D&O) coverage Excess umbrella liability coverage Coverage for business torts and consumer false advertising claims Coverage for environmental contamination claims Cyber liability and data breach   Charlie Edwards opened the discussions with comments about directors and officers liability insurance coverage, what D&O coverage decisions were issued in 2014, what key terms insureds should consider when looking at D&O coverage, and what insureds should expect in the marketplace for 2015. Chris Lynch then discussed developments in excess and umbrella liability insurance cases in 2014. He…

READ MORE
0 0

23 Jan 2015 “1-23-15 ALERT: VERMONT SUPREME COURT STRIKES DOWN AMBASSADOR IN LIQUIDATION’S 12/31/13 BAR DATE!

Today, the Vermont Supreme Court issues its opinion in the Ambassador in Liquidation case striking down the estate’s previously-published 12/31/13 bar date for final Proofs of Claim. The Ambassador Ins. Co. liquidation has been in process since 1987.  After the estate obtained over $300,000,000 in reinsurance and settlement proceeds from its former auditing firm, the estate essentially became “solvent”—paying Priority Four claims at 100 percent (plus interest). Seeking to bring the estate to a close, the liquidator set a final Proof of Claim date of 12/31/13 to require claimant-insureds to settle their underlying claims and submit them to the Ambassador estate. Many of the insureds have long-tail liabilities which are still developing and could not be resolved by the 2103 bar date. NICO, successor to…

READ MORE