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

15 Nov 2017 Tenth Circuit Holds that Governmental Investigation of Potential Criminal Violations is Not a ‘Claim’ Under a D&O Policy

  D&O insurance policies are key components of a corporation’s risk transfer portfolio, purchased to protect it against lawsuits presenting significant liability exposure to itself and its key officers and directors.   In recent years, as an alternative to targeted formal litigation and discovery in uncovering corporate wrongdoing, federal and state governments have increasingly utilized informal investigations. This trend has created an expensive new financial exposure in the business world, particularly for large corporations, which are often the targets of such inquiries, and corresponding questions about how D&O insurance policies cover such costs. Although many D&O policies have evolved to explicitly protect policyholders from the costs of responding to government investigations, many have not been amended, forcing courts to determine whether the existing language is…

READ MORE
0 0

03 Nov 2017 Daubert Challenge Resolves Coverage Dispute on Summary Judgment

  Daubert challenges are common in commercial disputes and often have a powerful impact on litigation results. As established by Federal Rule of Evidence 702 and the U.S. Supreme Court case Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 589 (1993) certain requirements were set forth for expert testimony to be admissible, like the expert’s qualifications and whether the testimony is based on sufficient facts and reliable methods.   However, it is not often that you see a Daubert challenge resolve an entire insurance coverage dispute – let alone at the summary judgment phase. Yet, the recent case Varlen Corporation v. Liberty Mutual Insurance Company, No. 13-cv-05463 (N.D. Ill. Sept. 25, 2017), did just that.   This case involved a coverage dispute stemming from environmental contamination that hinged on whether the pollution…

READ MORE
0 0

17 Oct 2017 Insurance Carriers Exclude Color Matching Requirements from Policies

  The summer of 2017 saw a number of severe storms in the Midwest, with resulting insurance claims. As policyholders have made those claims, some have been surprised to see new provisions in their insurance contracts.   Things are not always black and white in insurance policies, especially when it comes to the impact of a Minnesota court decision that required insurers providing replacement cost coverage to reasonably match replacement siding. Since the Minnesota Supreme Court issued its opinion in Cedar Bluff Townhome Condominium Association, Inc. v. American Family Mutual Insurance Company, insurers have begun inserting language in their policies that expressly precludes the coverage requirement of matching based upon color, a change in product specifications, or other factors, in an attempt to circumvent this…

READ MORE
0 0

13 Oct 2017 Clock Keeps Running on Insurers’ Good Faith and Fair Dealing Obligations in California

  Imagine this: Your insurer denied coverage, forcing you to file a lawsuit to secure policy benefits. The insurer retains litigation counsel and begins engaging in unreasonable litigation conduct to attempt to force you to abandon the case and to justify the insurer’s prior denial of coverage. What should you do?   Don’t ignore the ongoing bad faith conduct that may be occurring during litigation. In fact, under California law, the implied covenant of good faith and fair dealing in every insurance policy does not cease upon the filing of litigation and instead continues unabated. The standard dates back to 1985, when, in White v. Western Title Ins. Co., the California Supreme Court held “[i]t is clear that the contractual relationship between insurer and the…

READ MORE
0 0

09 Oct 2017 Four Things to Know About Certificates of Insurance

  One day, you’re asked to provide a Certificate of Insurance (COI) to someone with whom you’re doing business. The next day, you request a COI from another business. Do you know exactly what you’re giving and receiving in these seemingly routine transmissions? Do you get charged a fee for a COI? Here are four key points to keep in mind.   A COI is not an insurance policy   A COI is a form, usually completed by an insurance broker or insurance company, to document the existence of the insurance policy(ies) it describes. A COI often will include language indicating that it does not constitute a contract with the certificate holder, confers no rights on the certificate holder, and does not amend, alter or…

READ MORE
0 0

08 Sep 2017 Anti-Concurrent Causation Clauses: Why the Value of Your Property Coverage May Depend on Your State

A powerful storm pummels your city with high winds and heavy rains. After more than two days of intense wind and rain, the saturated hill behind your factory finally gives way and crashes into it. The building is severely damaged and your business operations are put on hold pending repairs. You need insurance money fast and file a claim with your property carrier.   Even though the policy doesn’t exclude property damage caused by wind or rain, it does contain an exclusion for earth movement “regardless of any other cause or event that contributes concurrently or in any sequence to the loss.” The carrier denies coverage because of the earth movement exclusion.  Is the carrier right? As it turns out, the answer may depend on…

READ MORE
0 0

01 Sep 2017 Preparing for and Responding to a Major Weather Event or Catastrophe

  The recent flooding in Houston in the wake of Hurricane Harvey serves as a vivid reminder that losses caused by weather events and natural disasters are becoming all too familiar sights.  According to numbers compiled by Munich Re, insured losses due to natural disasters in the United States in 2016 totaled $23.8 billion, a nearly 48 percent increase over the $16.1 billion total for 2015. The number of catastrophes (43) was the highest number of catastrophes in the 10 years from 2007 to 2016.   Results for 2017 remain uncertain based on Munich Re’s reporting so far this year. After a first quarter with record losses, the total at the half-way mark of 2017 was significantly below historical levels. The Houston flooding has caused…

READ MORE
0 0

30 Aug 2017 Contingent Business Interruption Coverage: Insuring the Far-Reaching Effects of Tropical Storm Harvey

  Manufacturers and producers are keenly aware of the value provided by business interruption coverage. Typically, this coverage is sold to companies as one of several coverages under their commercial property insurance package. Business interruption coverage is generally triggered by physical damage to a company asset (e.g., a manufacturing plant), which causes a suspension of business activities resulting in a loss of business income.   Tropical Storm Harvey has forced manufacturers and producers across Southeastern Texas to shut down operations while repairing their damaged facilities. These companies will turn to their business interruption carriers to recoup their business income lost during this period. However, for companies doing business in that region, but physically located outside the reach of Harvey, business interruption coverage may not protect…

READ MORE
0 0

30 Aug 2017 Fast-Moving Texas Insurance Law Changes: Starting Sept. 1, New Insurance Law Limits What a Policyholder May Recover

  House Bill 1774, passed by the Texas legislature in May, becomes law on Sept. 1 – just as Texans begin to assess the damages wrought by Hurricane Harvey. This law amends the Texas Insurance Code in a number of important ways, especially regarding what a policyholder can recover when an insurer doesn’t promptly pay a claim.   The new law applies to claims (not lawsuits) made on or after Sept. 1. A Texas company that owns property damaged in this storm should consider submitting a claim by Aug. 31.   The new law makes these important changes:   Waiting period. Starting with claims made as of Sept. 1, a policyholder generally will have to wait 61 days after giving notice to the insurance company…

READ MORE
0 0

29 Aug 2017 Back to School: Time to Revisit the Basic Principles of Business Interruption Coverage

  This time of year is always a good reminder to brush up on basic insurance coverage principles relevant to your industry. Business interruption risk poses a problem for every company, no matter its size or industry; making sure your company understands what coverage it has to protect against this risk is important.   After doing a presentation on business interruption coverage with Grant Thornton’s Forensics Advisory Services Group this summer, I was reminded how complex a claim for business interruption can be and the value that is added by having a good forensics accountant and coverage counsel aiding in the claims process.   Generally speaking, business interruption and extra expense coverage provides for lost revenues and expenses spent to restore your company. This type…

READ MORE