TreatiseAnswer Book

Business Liability Insurance Answer Book (2018 Edition)

 by Betsy P Collins, Burr & Forman LLP
 
 Copyright: 2017

 Product Details >> 

Product Details

  • ISBN Number: 9781402429835
  • Page Count: 496
  • Number of Volumes: 1
  •  

Being held personally liable for a businessrelated decision is the nightmare of every company manager, officer and director. As a result of the recent economic downturn, the number of cases being brought against businesses and the people who run them has surged. Business Liability Insurance Answer Book provides a concise roadmap to the kinds of issues being litigated, and the types of liability insurance available to protect against suit and cover losses in the event of a successful recovery.

Written in a clear and direct Q&A format, Business Liability Insurance Answer Book is a handy softcover volume that will be of interest to lawyers and other legal professionals, as well as the corporate managers, officers, directors and other employees whose liability this type of insurance protects against.
  Table of Contents
Chapter 1: Emerging Areas of Claims Litigation
  • : Possible Types of Claims and Litigation1-3
  • Q 1.1 : Who are the potential targets of litigation?1-3
  • Q 1.2 : What types of claims and litigation are likely?1-4
  • : Greatest Risk for Directors and Officers1-5
  • Q 1.3 : What types of claims pose the greatest risk of liability for directors and officers?1-5
    • Q 1.3.1 : What are derivative ations?1-5
    • Q 1.3.2 : What is a shareholder class action?1-6
    • Q 1.3.3 : What are some common types of securities law claims?1-6
    • Q 1.3.4 : How risky is shareholder litigation?1-7
    • Q 1.3.5 : What is ERISA?1-7
    • Q 1.3.6 : What is the SEC?1-7
    • Q 1.3.7 : What is the DOJ?1-7
    • Q 1.3.8 : What is the Foreign Corrupt Practices Act of 1977?1-8
  • : Foreign Corrupt Practices Act of 19771-8
  • Q 1.4 : Who does the FCPA cover?1-8
  • Q 1.5 : What does the FCPA cover?1-8
  • Q 1.6 : What are the criminal and regulatory ramifications of the FCPA?1-8
  • Q 1.7 : Can FCPA violations result in civil suits?1-9
  • : SEC and DOJ Investigations1-10
  • Q 1.8 : How concerned should directors and officers be about SEC and DOJ investigations?1-10
  • : Cyber Liability1-11
  • Q 1.9 : What risks are posed by data breaches?1-11
  • Q 1.10 : What is the Dodd-Frank Act?1-12
    • Q 1.10.1 : What is the effect of the Whistleblower Bounty Program?1-12
    • Q 1.10.2 : What is the effect of the conflict minerals disclosure requirement?1-13
  • : ERISA1-13
  • Q 1.11 : What is ERISA?1-13
    • Q 1.11.1 : What claims are likely to arise out of ERISA plans?1-13
    • Q 1.11.2 : Who are the targets of ERISA class actions?1-14
    • Q 1.11.3 : Why are ERISA class actions advantageous to plaintiffs’ lawyers?1-14
    • Q 1.11.4 : Are there new trends in ERISA claims?1-15
  • : Claims Against Professionals1-15
  • Q 1.12 : What claims are likely to arise against accountants/auditors?1-15
  • Q 1.13 : What claims are likely to arise against attorneys?1-15
  • : Employment Claims1-16
  • Q 1.14 : What types of employment claims are likely?1-16
  • : The Future1-18
  • Q 1.15 : How will the proliferation of litigation against officers and directors affect insurance coverage under D&O liability insurance policies?1-18
Chapter 2: Insurance Concepts and Definitions
  • : Concepts and Definitions2-2
  • Q 2.1 : What is an additional insured?2-2
  • Q 2.2 : What does adjudication or adjudicated mean?2-2
  • Q 2.3 : What is advancement?2-2
  • Q 2.4 : What is an aggregate limit?2-2
  • Q 2.5 : What is allocation?2-2
  • Q 2.6 : What is an application?2-3
  • Q 2.7 : What is arbitration?2-3
  • Q 2.8 : What is a binder?2-3
  • Q 2.9 : What is breach of duty?2-3
  • Q 2.10 : What is a broad form policy?2-3
  • Q 2.11 : What is a broker?2-3
  • Q 2.12 : What is business liability insurance?2-4
  • Q 2.13 : What is a captive insurance company?2-4
  • Q 2.14 : What is a claimant?2-4
  • Q 2.15 : What is a claims-made policy?2-4
  • Q 2.16 : What is a commercial general liability policy?2-5
  • Q 2.17 : What are conditions?2-5
  • Q 2.18 : What is contractual liability coverage?2-5
  • Q 2.19 : What does declarations mean?2-5
  • Q 2.20 : What is a deductible?2-5
  • Q 2.21 : What are the definitions?2-6
  • Q 2.22 : What is a derivative claim?2-6
  • Q 2.23 : What is difference in conditions coverage?2-6
  • Q 2.24 : What is directors’ and officers’ liability insurance?2-7
  • Q 2.25 : What is the duty to defend?2-7
  • Q 2.26 : What is the duty to indemnify?2-7
  • Q 2.27 : What is the duty to pay?2-7
  • Q 2.28 : What is the effective date of a policy?2-8
  • Q 2.29 : What is employee benefits plan liability coverage?2-8
  • Q 2.30 : What is employer’s liability insurance?2-8
  • Q 2.31 : What is employment practices liability insurance coverage?2-8
  • Q 2.32 : What is an endorsement?2-8
  • Q 2.33 : What is enterprise risk management?2-8
  • Q 2.34 : What is environmental damage?2-9
  • Q 2.35 : What is errors and omissions insurance?2-9
  • Q 2.36 : What is an excess policy?2-9
  • Q 2.37 : What are exclusions?2-9
  • Q 2.38 : What is an extended reporting period?2-10
  • Q 2.39 : What is fidelity insurance?2-10
  • Q 2.40 : What is a fiduciary?2-10
  • Q 2.41 : What is fiduciary liability coverage?2-11
  • Q 2.42 : What is a follow form policy?2-11
  • Q 2.43 : What is fraud?2-11
  • Q 2.44 : What is a fronting arrangement?2-11
  • Q 2.45 : What is full prior acts coverage?2-12
  • Q 2.46 : What is a hammer clause?2-12
  • Q 2.47 : What is the inception date?2-12
  • Q 2.48 : What is indemnification?2-12
  • Q 2.49 : What is an indemnity policy?2-12
  • Q 2.50 : What is the insuring agreement?2-12
  • Q 2.51 : What is an interim funding agreement?2-13
  • Q 2.52 : What is the known loss doctrine?2-13
  • Q 2.53 : What is liability insurance?2-13
  • Q : What is Lloyd’s of London?2-14
    • Q 2.55 : What is loss?2-14
    • Q 2.56 : What is a manuscript policy?2-14
    • Q 2.57 : What is material information?2-14
    • Q 2.58 : What is negligence?2-14
    • Q 2.59 : What is a notice of circumstances?2-14
    • Q 2.60 : What is an occurrence?2-15
    • Q 2.61 : What is an occurrence-based policy?2-15
    • Q 2.62 : What is a per-occurrence limit of liability?2-15
    • Q 2.63 : What is a plaintiff?2-15
    • Q 2.64 : What is a primary policy?2-15
    • Q 2.65 : What is professional liability insurance?2-16
    • Q 2.66 : What are punitive damages?2-16
    • Q 2.67 : What is recklessness?2-16
    • Q 2.68 : What is rescission?2-16
    • Q 2.69 : What is a reservation of rights letter?2-16
    • Q 2.70 : What is a retroactive date?2-16
    • Q 2.71 : What is a risk retention group (RRG)?2-17
    • Q 2.72 : What is severability?2-17
    • Q 2.73 : What is side A coverage?2-17
    • Q 2.74 : What is side A only coverage?2-17
    • Q 2.75 : What is side B coverage?2-17
    • Q 2.76 : What is side C coverage?2-17
    • Q 2.77 : What is subrogation?2-18
    • Q 2.78 : What is tail coverage?2-18
    • Q 2.79 : What is a tort?2-18
    • Q 2.80 : What is a wrongful act?2-19
Chapter 3: Practical Liability Insurance Solutions
  • : Attorneys3-2
  • Q 3.1 : Should I consult an attorney?3-2
  • Q 3.2 : What can an attorney do for me?3-2
  • Q 3.3 : How will my broker and my attorney work together?3-3
  • : Typical Business Coverage3-3
  • Q 3.4 : What is the typical business coverage we might want to include in our company’s liability insurance portfolio?3-3
  • Q 3.5 : What are some common coverage needs?3-4
  • : Specific Policies3-4
  • Q 3.6 : What type of claims might a CGL policy cover?3-4
  • Q 3.7 : What might a typical umbrella policy cover?3-5
  • Q 3.8 : What should a typical E&O policy cover?3-5
  • Q 3.9 : What should a typical employment practices liability insurance (EPLI) policy cover?3-5
  • Q 3.10 : What should a fiduciary liability policy cover?3-6
  • Q 3.11 : What should a typical internet liability policy cover?3-6
  • Q 3.12 : What should a typical private company D&O policy cover?3-6
  • Q 3.13 : What might a typical public company D&O policy cover?3-7
  • Q 3.14 : What kind of insurance covers cyber liability?3-7
    • Q 3.14.1 : What should a cyber insurance policy cover?3-7
  • : Understanding Which Policy Is Best for You3-8
  • Q 3.15 : How do I make the most of my premium dollars?3-8
  • Q 3.16 : How do I make sense of a policy form?3-9
    • Q 3.16.1 : What is the declarations page?3-9
    • Q 3.16.2 : What is the insuring agreement?3-9
    • Q 3.16.3 : What are the definitions?3-9
    • Q 3.16.4 : What are the exclusions?3-9
    • Q 3.16.5 : What are the endorsements?3-10
  • Q 3.17 : What duties do I have in applying for insurance?3-10
  • Q 3.18 : What does it mean when the application refers to other information incorporated into the application by reference like public filings?3-11
  • Q 3.19 : What is a Best rating and what does it mean to me?3-11
  • Q 3.20 : Why do we want excess layers of liability coverage—why can’t we just buy a primary policy with higher limits?3-11
  • Q 3.21 : What alternatives are there to traditional insurance carriers?3-12
  • Q 3.22 : What is a captive insurance company?3-12
    • Q 3.22.1 : What are the advantages of captive insurance?3-12
    • Q 3.22.2 : How common are captives?3-13
    • Q 3.22.3 : How are captives structured?3-13
    • Q 3.22.4 : What is a group captive?3-13
    • Q 3.22.5 : What is an associate captive?3-13
    • Q 3.22.6 : What is an agency captive?3-13
    • Q 3.22.7 : What is a risk retention group?3-14
    • Q 3.22.8 : What type of coverage is provided by an RRG?3-14
    • Q 3.22.9 : What are the advantages and potential risks of insuring with an RRG?3-14
  • Q 3.23 : How are captives regulated?3-15
Chapter 4: Commercial General Liability Coverage
  • : Basics of CGL Insurance4-2
  • Q 4.1 : What kind of liability risks does a business face?4-2
  • Q 4.2 : What is CGL insurance?4-3
  • Q 4.3 : Does CGL insurance cover damage to the insured’s property?4-4
  • Q 4.4 : What is a manuscript policy?4-4
  • : Benefits of CGL Coverage4-5
  • Q 4.5 : How does a CGL policy protect a company?4-5
  • Q 4.6 : What is the duty to defend benefit?4-5
    • Q 4.6.1 : When is the duty to defend triggered?4-5
  • Q 4.7 : What is the duty to indemnify benefit?4-6
  • Q 4.8 : What is the loss control benefit?4-6
  • Q 4.9 : What is the investigation benefit?4-6
  • Q 4.10 : What is the loss mitigation benefit?4-6
  • : When Does CGL Policy Apply?4-7
  • Q 4.11 : What categories of risks are covered by a CGL policy?4-7
  • Q 4.12 : When does coverage under a CGL policy come into play?4-7
  • Q 4.13 : When will coverage under a CGL policy be triggered?4-8
    • Q 4.13.1 : What is an occurrence-based policy?4-8
    • Q 4.13.2 : What is a claims-made policy?4-8
    • Q 4.13.3 : What types of manuscript policy triggers are available?4-8
  • : Standard CGL Policies4-9
  • Q 4.14 : What are the parts of the standard CGL policy?4-9
  • Q 4.15 : What are definitions?4-9
  • Q 4.16 : What are the declarations?4-9
  • Q 4.17 : What are limits of insurance?4-9
    • Q 4.17.1 : What is an aggregate limit?4-9
    • Q 4.17.2 : What is a per-occurence limit?4-10
  • Q 4.18 : What is included in Section I of the CGL policy?4-10
    • Q 4.18.1 : What is an insuring agreement?4-10
    • Q 4.18.2 : What are the coverage parts of a CGL policy?4-10
    • Q 4.18.3 : What are exclusions?4-10
  • Q 4.19 : What is included in Section II of the CGL policy form?4-10
    • Q 4.19.1 : Who is an insured?4-10
    • Q 4.19.2 : Who else is an insured?4-11
    • Q 4.19.3 : When is a volunteer worker an insured?4-11
    • Q 4.19.4 : When is an employee an insured?4-12
    • Q 4.19.5 : Are there any other limitations that govern whether an employee will be insured?4-12
    • Q 4.19.6 : What are the qualifications with respect to a newly acquired or newly formed organization being insured?4-13
    • Q 4.19.7 : Who should be insured under a CGL policy?4-13
  • Q 4.20 : What are conditions?4-14
    • Q 4.20.1 : What are our duties in regard to notifying the insurance carrier about a potential claim?4-14
    • Q 4.20.2 : What if we didn’t give notice of an accident and six months later we receive a summons and complaint?4-15
    • Q 4.20.3 : What are the consequences of failing to give prompt notice of claims, accidents or potential claims?4-15
    • Q 4.20.4 : If we settle a claim on our own, is the carrier responsible for paying it?4-16
    • Q 4.20.5 : Who gets to select defense counsel if we get sued?4-16
    • Q 4.20.6 : What is the duty to cooperate?4-16
  • Q 4.21 : What are endorsements?4-17
  • : Coverage A4-17
  • Q 4.22 : What is Coverage A?4-17
  • Q 4.23 : What is insured under Coverage A?4-17
  • Q 4.24 : What is bodily injury?4-18
    • Q 4.24.1 : Does bodily injury include emotional injury?4-18
    • Q 4.24.2 : What is an occurrence?4-18
    • Q 4.24.3 : What is typically not deemed an occurrence?4-18
  • Q 4.25 : What is property damage?4-18
    • Q 4.25.1 : Are lost profits considered property damage?4-19
    • Q 4.25.2 : What is premises/operations hazard?4-19
    • Q 4.25.3 : What is the products-completed operations hazard coverage?4-19
  • : Exclusions Under Coverage A4-19
  • Q 4.26 : What are the exclusions under Coverage A?4-19
  • Q 4.27 : What is the intentional or expected injury exclusion?4-20
  • Q 4.28 : What is the contractual liability exclusion?4-21
  • Q 4.29 : What is the liquor liability exclusion?4-21
  • Q 4.30 : What is the workers’ compensation exclusion?4-21
  • Q 4.31 : What is the employment liability exclusion?4-22
  • Q 4.32 : What is the pollution exclusion?4-22
    • Q 4.32.1 : What are pollutants?4-22
    • Q 4.32.2 : Are there any exceptions to the pollution exclusion?4-22
    • Q 4.32.3 : Is the cost of cleanup on behalf of a governmental authority excluded?4-22
  • Q 4.33 : What is the aircraft/auto/watercraft exclusion?4-23
  • Q 4.34 : What is the mobile equipment exclusion?4-23
  • Q 4.35 : What is the war exclusion?4-23
    • Q 4.35.1 : Does the war exclusion apply to terrorism?4-23
  • Q 4.36 : What is the damage to property exclusion?4-23
  • Q 4.37 : What is the damage to your work exclusion?4-24
  • Q 4.38 : What is the recall of products, work or impaired property exclusion?4-24
  • Q 4.39 : What is the damage to impaired property or property not physically injured exclusion?4-24
    • Q 4.39.1 : What is impaired property?4-25
    • Q 4.39.2 : What kind of loss of use claims are excluded?4-25
    • Q 4.39.3 : Are there exceptions to the damage to impaired property exclusion?4-25
  • Q 4.40 : What is the personal and advertising injury exclusion?4-25
  • Q 4.41 : What is the electronic data exclusion?4-25
  • Q 4.42 : What is the distribution of material in violation of statutes exclusion?4-25
  • Q 4.43 : What is the fungus/mold exclusion?4-26
  • Q 4.44 : What is the employment-related practices exclusion?4-26
  • Q 4.45 : What is the asbestos exclusion?4-26
  • Q 4.46 : What is the lead exclusion?4-26
  • Q 4.47 : What is the nuclear exclusion?4-26
  • Q 4.48 : What is the securities and financial interest exclusion?4-26
  • Q 4.49 : What is the silica exclusion?4-27
  • Q 4.50 : What is the known injury or damage exclusion?4-27
  • : Coverage B4-27
  • Q 4.51 : What is Coverage B?4-27
  • Q 4.52 : Who needs Coverage B?4-27
  • Q 4.53 : What kinds of claims are covered under Coverage B?4-28
  • : Exclusions Under Coverage B4-29
  • Q 4.54 : What claims are excluded under Coverage B?4-29
  • Q 4.55 : What is the knowing violation of rights of another exclusion?4-30
  • Q 4.56 : What is the material published with knowledge of falsity exclusion?4-30
  • Q 4.57 : What is the material published prior to policy period exclusion?4-30
  • Q 4.58 : What is the criminal acts exclusion?4-30
  • Q 4.59 : What is the contractual liability exclusion?4-31
  • Q 4.60 : What is the breach of contract exclusion?4-31
  • Q 4.61 : What is the quality or performance of goods—failure to conform to statements exclusion?4-31
  • Q 4.62 : What is the wrong description of prices exclusion?4-31
  • Q 4.63 : What is the infringement of copyright, patent, trademark or trade secret exclusion?4-31
  • Q 4.64 : What is the insured’s in media and Internet-type businesses exclusion?4-32
  • Q 4.65 : What is the electronic chatroom or bulletin boards exclusion?4-32
  • Q 4.66 : What is the unauthorized use of another’s name or product exclusion?4-32
  • Q 4.67 : What is the pollution exclusion?4-33
  • Q 4.68 : What is the pollution-related exclusion?4-33
  • Q 4.69 : What is the war exclusion?4-33
  • Q 4.70 : What are the other exclusions that apply to Coverage B?4-33
  • : Coverage C4-33
  • Q 4.71 : What is Coverage C?4-33
  • Q 4.72 : When does Coverage C apply?4-34
  • Q 4.73 : What are covered medical expenses under Coverage C?4-34
  • : Exclusions Under Coverage C4-34
  • Q 4.74 : What are exclusions under Coverage C?4-34
  • : Other Insurance4-35
  • Q 4.75 : What is the purpose of the other insurance provision?4-35
  • Q 4.76 : How does the other insurance provision work when there are excess policies?4-35
  • Q 4.77 : When is the CGL policy deemed excess?4-36
  • Q 4.78 : What happens when the CGL policy is primary, but there are other primary policies that also apply?4-36
    • Q 4.78.1 : What is contribution by equal shares?4-36
    • Q 4.78.2 : What is contribution by limits?4-37
  • : Representations Clause4-37
  • Q 4.79 : What is the representations clause?4-37
  • Q 4.80 : What kind of misstatement in the application will justify the carrier avoiding coverage?4-37
  • Q 4.81 : What is the separation of insured clause?4-37
  • : Tailoring a CGL Policy4-38
  • Q 4.82 : Can we tailor a CGL policy to meet the specific or unique business needs of our business?4-38
  • Q 4.83 : What are some kinds of liability that should be addressed through purchasing special or separate coverage through another policy or endorsement?4-38
  • : Endorsements4-39
  • Q 4.84 : What types of endorsements are available?4-39
  • Q 4.85 : What is the additional insured endorsement?4-39
    • Q 4.85.1 : Practically speaking, what does the additional insured endorsement actually insure?4-40
    • Q 4.85.2 : Can the additional insured be covered for its own negligence under the additional insured endorsement?4-41
    • Q 4.85.3 : Is there coverage for an injury sustained by an additional insured or the employee of an additional insured where such injury is the result of a workplace accident?4-42
  • Q 4.86 : Are the endorsements discussed in this chapter the only ones available?4-42
  • : Advertising Injury Coverage4-43
  • Q 4.87 : Can you purchase coverage for advertising injury even though the standard policy form excludes such coverage?4-43
  • : CGL Policy and Construction Projects4-43
  • Q 4.88 : How will a CGL policy operate in a construction setting?4-43
  • Q 4.89 : What type of property damage is covered under a CGL policy issued to a contractor?4-43
    • Q 4.89.1 : What is the difference between coverage under a CGL policy and a surety policy?4-44
    • Q 4.89.2 : When will coverage be triggered under a contractor’s general liability policy?4-44
    • Q 4.89.3 : What is the subcontractor exception to the your work exclusion?4-45
  • Q 4.90 : Does the completed operations hazards clause have any effect on a contractor’s liability insurance policy?4-45
  • : Product Liability Insurance4-46
  • Q 4.91 : Who needs product liability insurance?4-46
  • Q 4.92 : What is product liability insurance?4-46
  • Q 4.93 : What kinds of claims arise out of the manufacture, distribution or sale of goods or products?4-46
  • Q 4.94 : Who might be sued for products liability?4-47
  • Q 4.95 : What is the legal basis for products liability?4-47
  • Q 4.96 : What type of claims are covered under a CGL endorsement relating to products liability?4-47
    • Q 4.96.1 : Do the products hazard and completed operations hazards clauses affect coverage under a CGL policy for products liability–related claims?4-47
    • Q 4.96.2 : What is the sistership exclusion included in CGL policies insuring products liability claims?4-48
  • : Environmental or Pollution Claims4-49
  • Q 4.97 : Can we purchase liability insurance to cover environmental or pollution claims?4-49
  • Q 4.98 : What is an absolute pollution exclusion?4-49
    • Q 4.98.1 : What is a qualified pollution exclusion?4-50
  • Q 4.99 : Can any business purchase an endorsement that will provide coverage for liability resulting from environmental pollution?4-50
  • : Endorsements Relating to Real Property4-51
  • Q 4.100 : Are there endorsements that relate specifically to real property?4-51
  • Q 4.101 : What does a landlord’s policy cover?4-51
  • Q 4.102 : Is there any need for a lender to obtain CGL coverage, or seek coverage under some type of endorsement?4-51
  • Q 4.103 : What about claims based on the entry on/eviction from property or otherwise relate to the right of private occupancy to property?4-51
  • : Motor Carrier Liability4-52
  • Q 4.104 : Is there coverage for motor carrier liability?4-52
  • : Emerging Issue: Coverage Under CGL Policies for Cyber Attacks4-52
  • Q 4.105 : Why is coverage for cyber attacks important?4-52
    • Q 4.105.1 : Are cyber attacks covered by Coverage A (Property Damage) under an ISO CGL policy?4-53
    • Q 4.105.2 : Are cyber attacks covered by Coverage B (Personal and Advertising Injury Liability) under an ISO CGL policy?4-54
    • Q 4.105.3 : What are the new ISO cyber exclusion endorsements?4-54
Chapter 5: Professional Liability Insurance
  • : Features of Professional Liability Insurance5-2
  • Q 5.1 : What is the difference between errors and omissions (E&O) insurance and professional liability insurance?5-2
  • Q 5.2 : What are the significant features of professional liability insurance?5-2
  • Q 5.3 : What is a professional?5-3
  • Q 5.4 : Who are professionals?5-3
  • Q 5.5 : What do professional services include?5-3
  • Q 5.6 : What is professional liability insurance designed to cover?5-3
  • Q 5.7 : What is the difference between a commercial general liability policy and an E&O policy?5-4
  • Q 5.8 : Who is typically insured under a professional liability insurance policy?5-4
  • : Duty to Defend5-5
  • Q 5.9 : Does the insurance carrier have a duty to defend me under my professional liability policy?5-5
  • Q 5.10 : What is the advantage of a duty to defend policy?5-5
  • Q 5.11 : Does the duty to defend apply even if the allegations are false?5-6
  • Q 5.12 : Do I have to reimburse the insurer for costs of defense if the claims turn out to not be covered?5-6
  • Q 5.13 : Are defense costs in addition to the limits of liability?5-6
  • : Claims-Made Versus Occurrence-Based5-6
  • Q 5.14 : Is my professional liability policy a claims-made or an occurrence-based policy?5-6
    • Q 5.14.1 : What is an occurrence-based policy?5-7
    • Q 5.14.2 : What is a claims-made policy?5-7
    • Q 5.14.3 : What is a claims-made and reported policy?5-7
  • Q 5.15 : What are some claims that might trigger professional liability coverage?5-7
  • : Parts of a Typical Professional Liability Policy5-8
  • Q 5.16 : What are declarations?5-8
  • Q 5.17 : What is the insuring agreement?5-8
  • Q 5.18 : What are exclusions?5-8
  • Q 5.19 : What are definitions?5-8
  • Q 5.20 : What are conditions?5-8
  • Q 5.21 : What are endorsements?5-8
  • : Potential Definitional Problems5-8
  • Q 5.22 : What are definitional problems that might be encountered with professional liability claims?5-8
  • Q 5.23 : Who is insured?5-9
  • Q 5.24 : What is a wrongful act?5-9
  • Q 5.25 : What is insured capacity?5-9
  • Q 5.26 : Why is the definition of claim important?5-9
  • Q 5.27 : What is aggregate limit?5-10
  • Q 5.28 : What is the significance of interrelated claims?5-10
  • Q 5.29 : What determines whether there is one claim or multiple claims?5-11
  • Q 5.30 : Does an investigative demand or governmental subpoena constitute a claim?5-11
  • Q 5.31 : Is a complaint seeking injunctive relief a claim?5-11
  • Q 5.32 : What is covered loss or covered damages?5-12
  • Q 5.33 : What is restitution?5-12
  • Q 5.34 : What are punitive damages?5-13
  • Q 5.35 : Are fines, penalties or sanctions covered loss ?5-13
  • : Exclusions from Professional Liability Policy5-13
  • Q 5.36 : What exclusions might apply to a professional liability policy?5-13
  • Q 5.37 : What is the dishonesty, fraudulent or criminal acts exclusion?5-14
    • Q 5.37.1 : If my law partner does something dishonest and I get sued, does the dishonesty exclusion bar coverage for me too?5-15
    • Q 5.37.2 : At what point can the insurer deny coverage based on the dishonesty exclusion?5-16
    • Q 5.37.3 : What if one of the insureds under our professional liability policy signs a confession admitting that he is guilty of criminal conduct?5-16
    • Q 5.37.4 : If a court enters judgment against an insured under our professional liability policy that establishes dishonesty or fraud, do we have to repay the costs of defense?5-17
    • Q 5.37.5 : If an insured agrees to settle a claim, does that mean the insurer can claim that bad conduct has been established?5-17
    • Q 5.37.6 : Can the insurer sue an insured in a separate court action and get a judgment that the insured was guilty of dishonesty or fraud so as to avoid coverage?5-17
  • Q 5.38 : What is the personal profit or advantage exclusion?5-18
    • Q 5.38.1 : Is it important to have language in the policy requiring a final adjudication before the personal profit exclusion applies?5-18
    • Q 5.38.2 : Can the personal profit exclusion bar coverage for an innocent insured where another insured is actually the one who received the benefit?5-18
  • Q 5.39 : What is the misappropriation of another’s intellectual property exclusion?5-18
  • Q 5.40 : What is the sexual misconduct exclusion?5-19
  • Q 5.41 : What is the willful violation of law or statute exclusion?5-19
    • Q 5.41.1 : Is it important to have language in the policy requiring a final adjudication before the intentional acts exclusion applies?5-19
  • Q 5.42 : What is an insured versus insured exclusion?5-19
    • Q 5.42.1 : How can we avoid problems with the insured versus insured exclusion?5-20
  • Q 5.43 : What are environmental exclusions?5-21
  • Q 5.44 : What are securities laws exclusions?5-21
  • Q 5.45 : What are fee dispute exclusions?5-21
  • Q 5.46 : What are contract exclusions?5-22
  • Q 5.47 : What are other insurance exclusions?5-22
    • Q 5.47.1 : What are discrimination and harassment exclusions?5-22
    • Q 5.47.2 : What are prior acts exclusions?5-22
    • Q 5.47.3 : What are prior notice exclusions?5-22
    • Q 5.47.4 : What problems arise with prior notice exclusions?5-23
    • Q 5.47.5 : What are prior knowledge exclusions?5-23
    • Q 5.47.6 : What are ERISA exclusions?5-23
    • Q 5.47.7 : What are workers’ compensation exclusions?5-24
    • Q 5.47.8 : What are bodily injury or loss of property exclusions?5-24
    • Q 5.47.9 : What are exclusions for libel, slander and defamation?5-25
    • Q 5.47.10 : What is the motor vehicle exclusion?5-25
    • Q 5.47.11 : What is the cyber liability exclusion?5-25
  • : Duties of the Insured5-25
  • Q 5.48 : What are the duties of the insured in the event of a claim?5-25
  • Q 5.49 : What duty does the insured have with regard to providing notice of a claim?5-26
  • Q 5.50 : What triggers the duty to notify the insurer of a potential claim?5-27
  • Q 5.51 : What method of providing notice is required?5-27
  • Q 5.52 : What are the consequences of failure to give timely notice?5-28
  • Q 5.53 : What is the duty to assist or cooperate?5-28
  • Q 5.54 : What is the duty to provide documents or submit to examination?5-29
  • Q 5.55 : What are the most common issues encountered by insureds with regard to the duty of cooperation?5-30
  • : Potential Problems with Disclosures5-30
  • Q 5.56 : What are potential problems with disclosures on the insurance application?5-30
  • Q 5.57 : What are the typical disclosure requirements for potential claims?5-30
  • Q 5.58 : Do I have to provide information not requested on the application?5-31
  • Q 5.59 : What happens if I do not answer a question?5-32
  • Q 5.60 : What happens if I give an incomplete answer?5-32
  • Q 5.61 : How precise do I have to be on those questions that ask what percentage of my time is spent on certain activities?5-32
  • : Selecting Counsel5-32
  • Q 5.62 : Who has the right to select counsel?5-32
    • Q 5.62.1 : What is panel counsel?5-33
  • Q 5.63 : Who does the insurer-appointed attorney represent?5-33
  • Q 5.64 : Should I be worried that the defense attorney is more interested in what the insurer wants than in what is best for me?5-33
  • Q 5.65 : What if I want to settle the claim and the insurer does not?5-33
  • Q 5.66 : What if the insurance company wants me to agree to a settlement?5-34
    • Q 5.66.1 : What is a hammer clause?5-34
    • Q 5.66.2 : Is a hammer clause enforceable?5-35
    • Q 5.66.3 : Can the insurance company settle a case without telling me?5-35
  • Q 5.67 : Can I settle a claim without asking the insurer?5-35
  • : Specialized Professional Liability Insurance5-36
  • Q 5.68 : What types of professions have specialized professional liability coverage?5-36
  • : Accountants5-36
  • Q 5.69 : Who is insured under our accountant’s professional liability coverage?5-36
  • Q 5.70 : What types of services are covered under our accountant professional liability coverage?5-36
  • Q 5.71 : What types of claims are covered under our accountant professional liability policy?5-37
  • Q 5.72 : What loss or damages are covered under our accountant professional liability coverage?5-37
  • Q 5.73 : What loss or damages may not be covered under our accountant professional liability coverage?5-38
  • Q 5.74 : What are some common exclusions under an accountant professional liability coverage?5-38
  • Q 5.75 : Do we have a right to choose our own counsel?5-39
  • Q 5.76 : Do we have a right to veto settlement?5-39
  • Q 5.77 : What are incentive provisions?5-39
  • Q 5.78 : What is a late notice savings clause?5-39
  • : Architects and Engineers5-40
  • Q 5.79 : Who is insured under our professional liability coverage?5-40
  • Q 5.80 : What kinds of claims does our architect and engineer professional liability policy cover?5-40
    • Q 5.80.1 : What are professional services?5-40
  • Q 5.81 : What loss or damages are covered under our architect and engineer professional liability policy?5-41
  • Q 5.82 : What loss or damages may not be covered under our architect and engineer professional liability policy?5-41
  • Q 5.83 : What are some common exclusions under an architect and engineers professional liability coverage?5-41
  • Q 5.84 : Do we have a right to choose our own counsel?5-42
  • Q 5.85 : Do we have a right to veto settlement?5-42
  • : Attorneys5-42
  • Q 5.86 : Are attorneys required to carry professional liability insurance as a condition for being licensed?5-42
  • Q 5.87 : Are there any special considerations for attorneys with regard to applications for professional liability insurance?5-42
  • Q 5.88 : Who is insured under our lawyers professional liability policy coverage?5-43
  • Q 5.89 : What kinds of claims does our lawyer’s professional liability policy cover?5-44
    • Q 5.89.1 : Will my coverage include risks associated with the unintentional disclosure of confidential client information due to a cyber attack?5-44
  • Q 5.90 : What professional services are covered under our lawyer’s policy professional liability coverage?5-45
  • Q 5.91 : What losses or damages are covered under our lawyer’s professional liability policy?5-45
  • Q 5.92 : What are some common exclusions under a lawyer’s professional liability policy?5-46
  • Q 5.93 : Do we have a right to choose our own counsel?5-47
  • Q 5.94 : Do we have a right to veto settlement?5-47
  • : Financial Institutions5-47
  • Q 5.95 : What are special considerations for financial institutions?5-47
  • Q 5.96 : Who is insured under our financial institution professional liability policy?5-47
  • Q 5.97 : What kinds of claims does our financial institution professional liability policy cover?5-48
    • Q 5.97.1 : What are professional services?5-48
  • Q 5.98 : What loss or damages are covered under our financial institution professional liability policy?5-48
  • Q 5.99 : What loss or damages may not be covered under our financial institution professional liability policy?5-48
  • Q 5.100 : What are some common exclusions under a financial institution liability policy?5-49
  • Q 5.101 : Do we have a right to choose our own counsel?5-49
  • Q 5.102 : Do we have a right to veto settlement?5-49
  • : Health Care Professionals5-50
  • Q 5.103 : What are special considerations for health care professionals?5-50
  • Q 5.104 : Who is insured under our health care organization professional liability coverage?5-51
  • Q 5.105 : Who is insured under my individual health care professional liability coverage?5-51
  • Q 5.106 : What if a physician cannot find liability coverage?5-52
  • Q 5.107 : How do JUAs or PCFs work?5-52
  • Q 5.108 : What kinds of services does our health care organization professional liability policy cover?5-52
  • Q 5.109 : What types of services are covered under my individual health care professional liability policy?5-53
  • Q 5.110 : What types of claims are covered under our health care professional liability policy?5-53
  • Q 5.111 : What loss or damages are covered under our health care professional liability policy?5-53
  • Q 5.112 : What loss or damages may not be covered under our health care professional liability policy?5-54
  • Q 5.113 : What are some common exclusions under a health care professional liability policy?5-54
  • Q 5.114 : Do we have a right to choose our own counsel?5-55
  • Q 5.115 : Do we have a right to veto settlement?5-55
  • Q 5.116 : How are premiums set?5-55
  • : Insurance Professionals5-55
  • Q 5.117 : Who buys insurance professional liability coverage?5-55
  • Q 5.118 : Are there special considerations for insurance professionals?5-56
  • Q 5.119 : What kinds of claims does our insurance agents and brokers errors and omissions policy cover?5-56
  • Q 5.120 : Who is insured under our insurance professional liability policy?5-57
  • Q 5.121 : What loss or damages are covered under our insurance professional liability coverage?5-58
  • Q 5.122 : What loss or damages may not be covered under our insurance professional liability coverage?5-58
  • Q 5.123 : What are some common exclusions under an insurance professional liability coverage?5-59
  • Q 5.124 : Do we have a right to choose our own counsel?5-60
  • Q 5.125 : Do we have a right to veto settlement?5-60
  • : Media Liability Coverage5-60
  • Q 5.126 : Who buys media liability coverage?5-60
  • Q 5.127 : What protection does media liability insurance afford?5-60
  • Q 5.128 : Who is insured under our media professional liability policy?5-61
  • Q 5.129 : What kinds of activities of media professionals are included in the risks insured by media liability insurance?5-61
  • Q 5.130 : Are there any limitations to the breadth of the covered activities under our media liability policy?5-62
  • Q 5.131 : What loss or damages are covered under our media professional liability policy?5-62
  • Q 5.132 : What if we are responsible for liability because of a contract?5-62
  • Q 5.133 : What loss or damages may not be covered under our media professional liability policy?5-62
  • Q 5.134 : What are some common exclusions under our media professional liability coverage?5-63
  • Q 5.135 : Do we have a right to choose our own counsel?5-64
  • Q 5.136 : Do we have a right to veto settlement?5-64
  • Q 5.137 : What special considerations apply to Internet-related services?5-64
  • Q 5.138 : What types of claims are asserted against Internet service professionals?5-64
  • : Technology Companies5-65
  • Q 5.139 : What are special considerations for technology companies?5-65
  • Q 5.140 : What are some of the risks that technology companies face?5-65
  • Q 5.141 : What services will be included under our technology professional liability policy?5-66
  • Q 5.142 : Who is insured under our technology professional liability policy?5-66
  • Q 5.143 : What types of claims does our technology professional liability policy cover?5-66
  • Q 5.144 : What loss or damages may not be covered under our technology professional liability policy?5-67
  • Q 5.145 : What are some common exclusions under a technology professional liability coverage?5-67
  • Q 5.146 : Do we have a right to choose our own counsel?5-69
  • Q 5.147 : Do we have a right to veto settlement?5-69
Chapter 6: Directors’ and Officers’ Liability Insurance
  • : Determining D&O Coverage Needs6-3
  • Q 6.1 : What are some of the claims that might trigger D&O coverage?6-3
  • Q 6.2 : How can our broker help us define our D&O insurance needs?6-3
  • Q 6.3 : Do we need to consult an attorney in evaluating D&O policies?6-4
  • Q 6.4 : What is a manuscript policy?6-4
  • Q 6.5 : What are the typical D&O insuring agreements?6-4
  • : Side A Coverage6-5
  • Q 6.6 : What is Side A coverage?6-5
  • Q 6.7 : How do indemnification and D&O coverage work together?6-5
  • Q 6.8 : When does Side A coverage apply?6-6
  • Q 6.9 : In what instances will the corporation not indemnify the officers or directors?6-6
  • Q 6.10 : What is Side A excess coverage?6-7
  • : Side B Coverage6-8
  • Q 6.11 : What is Side B coverage?6-8
  • Q 6.12 : When is reimbursement made under Side B coverage?6-8
  • : Side C Coverage6-9
  • Q 6.13 : What is Side C coverage?6-9
  • : Shareholder Derivative Demand Coverage6-9
  • Q 6.14 : What is shareholder derivative demand coverage?6-9
  • Q 6.15 : What is a shareholder demand?6-9
  • Q 6.16 : Why do we need shareholder derivative demand coverage?6-10
  • Q 6.17 : Does our D&O policy cover the costs of investigations?6-11
    • Q 6.17.1 : Are internal investigations covered?6-11
    • Q 6.17.2 : How likely are we to utilize investigative costs coverage?6-11
  • : Outside Entity Insured Person Coverage6-12
  • Q 6.18 : What is outside entity insured person coverage?6-12
  • : Defense Costs6-12
  • Q 6.19 : Does the insurance carrier have a duty to defend us under our D&O policy?6-12
  • Q 6.20 : Do I have to reimburse the insurer for costs of defense if the claims turn out not to be covered?6-13
  • Q 6.21 : Are defense costs in addition to the limits of liability?6-13
  • : Claims Made6-14
  • Q 6.22 : Is our D&O policy a claims-made policy or an occurrence-based policy?6-14
    • Q 6.22.1 : What is a claims-made policy?6-14
  • : Parts of the D&O Policy6-14
  • Q 6.23 : What are the parts of a typical D&O policy?6-14
    • Q 6.23.1 : What are declarations?6-14
    • Q 6.23.2 : What is the insuring agreement?6-14
    • Q 6.23.3 : What are exclusions?6-15
    • Q 6.23.4 : What are definitions?6-15
    • Q 6.23.5 : What are conditions?6-15
    • Q 6.23.6 : What are endorsements?6-15
  • : Potential Problems6-15
  • Q 6.24 : What potential problems might we encounter with D&O claims?6-15
  • : Disclosure Problems6-15
  • Q 6.25 : What are potential problems with disclosures on the insurance application?6-15
    • Q 6.25.1 : What is rescission?6-16
    • Q 6.25.2 : Do we have to provide information not requested on an application?6-16
    • Q 6.25.3 : What happens if we do not answer a question?6-16
    • Q 6.25.4 : What happens if we give an incomplete answer?6-16
    • Q 6.25.5 : Can the insurance carrier rely on things not listed in our specific answers on the application?6-17
    • Q 6.25.6 : What is severability and why is it important to me?6-17
  • : Definitional Problems6-17
  • Q 6.26 : What are definitional problems?6-17
    • Q 6.26.1 : Who is insured?6-18
    • Q 6.26.2 : What problems might arise with regard to who is insured?6-18
    • Q 6.26.3 : What is insured capacity?6-18
    • Q 6.26.4 : What qualifies as an insured subsidiary?6-19
    • Q 6.26.5 : How can you protect yourselves against confusion as to what entities are to be insured under the policy?6-19
  • : Who Qualifies As an Officer?6-20
  • Q 6.27 : What problems might we encounter with regard to who qualifies as an officer?6-20
    • : Claims6-22
    • Q 6.27.1 : What is a claim?6-22
    • Q 6.27.2 : Why is the definition of claim important?6-22
    • Q 6.27.3 : Does an investigative demand or governmental subpoena constitute a claim?6-23
    • Q 6.27.4 : Is a complaint seeking injunctive relief a claim?6-23
    • : Wrongful Act6-23
    • Q 6.27.5 : What is a wrongful act?6-23
    • Q 6.27.6 : What does wrongful act mean in the insured person context?6-23
    • Q 6.27.7 : What does wrongful act mean in connection with a public company insured organization?6-24
    • Q 6.27.8 : What is a securities claim?6-24
    • Q 6.27.9 : What does wrongful act mean in connection with a private company insured organization?6-24
    • Q 6.27.10 : What does wrongful act mean when used in connection with an outside entity?6-25
    • Q 6.27.11 : What happens when the allegations include both covered and non-covered acts?6-25
    • Q 6.27.12 : When must the wrongful acts have occurred to be covered?6-25
    • Q 6.27.13 : What does interrelated wrongful acts mean?6-26
    • : Loss6-27
    • Q 6.27.14 : What is loss?6-27
    • Q 6.27.15 : What is included within the definition of loss?6-27
    • Q 6.27.16 : What are punitive damages?6-28
    • Q 6.27.17 : What is not included as loss?6-28
    • Q 6.27.18 : What are some of the problems encountered with loss?6-29
    • Q 6.27.19 : What is restitution?6-29
  • : Exclusions6-30
  • Q 6.28 : What exclusions might apply?6-30
  • Q 6.29 : What problems are encountered with introductory phrases and exclusions?6-31
  • Q 6.30 : What are conduct exclusions?6-32
  • Q 6.31 : What is the personal profit or advantage exclusion?6-32
    • Q 6.31.1 : What is the effect of the final adjudication language?6-33
  • Q 6.32 : What is the dishonesty, fraudulent or criminal acts exclusion?6-34
    • Q 6.32.1 : What if one of the insureds under our D&O policy signs a confession admitting that he is guilty of criminal conduct?6-35
    • Q 6.32.2 : Does the bad conduct of one insured bar coverage for other insureds under the conduct exclusions?6-36
    • Q 6.32.3 : What is a severability of exclusions provision?6-36
    • Q 6.32.4 : If a court enters judgment against an insured under our D&O liability policy that establishes dishonesty or fraud, do we have to repay the costs of defense?6-37
    • Q 6.32.5 : If an insured agrees to settle a claim, does that mean that the insurer can claim that bad conduct has been established?6-37
    • Q 6.32.6 : Can the insurer sue an insured in a separate court action and get a judgment that the insured was guilty of dishonesty or fraud so as to avoid coverage?6-37
  • Q 6.33 : What are specific exclusions?6-37
    • Q 6.33.1 : What is the insured versus insured exclusion?6-38
    • Q 6.33.2 : Why do carriers want to limit coverage of insured versus insured claims?6-38
    • Q 6.33.3 : How can we avoid problems with the insured versus insured exclusion?6-38
    • Q 6.33.4 : What does a typical insured versus insured exclusion look like?6-39
    • Q 6.33.5 : What are regulatory exclusions?6-40
    • Q 6.33.6 : What is the pollution exclusion?6-40
    • Q 6.33.7 : What is the securities laws exclusion?6-41
    • Q 6.33.8 : What is the contract exclusion?6-41
    • Q 6.33.9 : What are other insurance exclusions?6-41
    • Q 6.33.10 : What is the employment practices exclusion?6-42
    • Q 6.33.11 : What is the prior acts exclusion?6-42
    • Q 6.33.12 : What is the prior notice exclusion?6-42
    • Q 6.33.13 : What problems arise with a prior notice exclusion?6-43
    • Q 6.33.14 : What is the prior or pending litigation exclusions?6-43
    • Q 6.33.15 : What is the ERISA exclusion?6-43
    • Q 6.33.16 : What is the bodily injury or loss of property exclusion?6-44
    • Q 6.33.17 : What kinds of problems might we encounter with other insurance exclusions?6-44
  • Q 6.34 : What other exclusions might be included in our D&O policy?6-44
  • : Duties of the Insured6-45
  • Q 6.35 : What are the duties of the insured in the event of a claim?6-45
  • Q 6.36 : What duty does the insured have with regard to providing notice of a claim?6-45
  • Q 6.37 : What triggers the duty to notify the insurer of a potential claim?6-46
  • Q 6.38 : If we have notice of a potential claim, how do we make sure we are covered?6-47
  • Q 6.39 : What is a Notice of Circumstance?6-47
  • Q 6.40 : What method of providing notice is required?6-47
  • Q 6.41 : What are the consequences of failure to give timely notice?6-48
  • Q 6.42 : What is the duty to cooperate?6-48
    • Q 6.42.1 : What are the most common issues encountered by insureds with regard to the duty of cooperation?6-48
  • : Counsel6-49
  • Q 6.43 : Who has the right to select counsel?6-49
  • Q 6.44 : What is panel counsel?6-49
  • Q 6.45 : Who does the insurer-appointed attorney represent?6-49
  • Q 6.46 : Should I be worried that the defense attorney is more interested in what the insurer wants than in what is best for me?6-49
  • : Settlements6-50
  • Q 6.47 : Do outside directors ever have to contribute to settlements of securities class actions?6-50
  • Q 6.48 : If there’s so much risk, why aren’t directors called upon to contribute to settlements more often?6-50
  • Q 6.49 : Who controls the process of settlement?6-50
Chapter 7: Fiduciary Liability Insurance
  • : Features of Fiduciary Liability Insurance7-3
  • Q 7.1 : What is ERISA?7-3
  • Q 7.2 : What is an ERISA plan?7-3
    • Q 7.2.1 : What is an employee pension benefit plan?7-3
    • Q 7.2.2 : What is an employee welfare benefit plan?7-3
    • Q 7.2.3 : What is an employee organization?7-3
    • Q 7.2.4 : Who might create an ERISA plan?7-3
  • Q 7.3 : Who is an ERISA fiduciary?7-4
    • Q 7.3.1 : Must there be formal documents appointing a person or entity as a fiduciary?7-4
  • Q 7.4 : What duties does an ERISA fiduciary have?7-4
  • Q 7.5 : What is a fiduciary precluded from doing?7-5
  • Q 7.6 : What are the consequences of breaching fiduciary duties?7-5
  • Q 7.7 : I depend on third parties to administer most of my employee benefit plans, so why should I consider purchasing fiduciary liability insurance coverage?7-5
    • Q 7.7.1 : Can an employer insulate itself from liability by providing employee benefits through a third party such as a disability or health insurance company?7-6
  • Q 7.8 : Is an employer subject to claims for discrimination under ERISA?7-7
  • Q 7.9 : Who needs to worry about claims potentially covered by a fiduciary liability insurance policy?7-7
  • Q 7.10 : Who is at risk for fiduciary liability under ERISA?7-7
  • Q 7.11 : Can a fiduciary face criminal penalties?7-8
  • Q 7.12 : Who can pursue claims against employers and fiduciaries?7-8
  • Q 7.13 : Where can an ERISA action be filed?7-8
  • Q 7.14 : What other penalties might be imposed under ERISA?7-8
  • Q 7.15 : What coverage language should we look for in a fiduciary liability insurance policy?7-9
  • Q 7.16 : How can our broker help us define our fiduciary liability insurance needs?7-10
  • Q 7.17 : Do we need to consult an attorney in evaluating fiduciary liability policies?7-10
  • Q 7.18 : What is a manuscript policy?7-10
  • : Duty to Defend7-10
  • Q 7.19 : Does the insurance carrier have a duty to defend us under our fiduciary liability policy?7-10
    • Q 7.19.1 : Do I have to reimburse the insurer for the costs of defense if the claims turn out not to be covered?7-11
    • Q 7.19.2 : Are defense costs in addition to the limits of liability?7-11
  • Q 7.20 : What if we discover an error in plan administration before any claims are filed against me?7-11
  • : Claims-Made Versus Occurrence-Based7-12
  • Q 7.21 : Is our fiduciary liability policy a claims-made policy or an occurrence-based policy?7-12
  • Q 7.22 : What is a claims-made policy?7-12
    • Q 7.22.1 : What is tail coverage?7-12
  • : Parts of a Typical Fiduciary Liability Policy7-12
  • Q 7.23 : What are the parts of a typical fiduciary liability policy?7-12
    • Q 7.23.1 : What are declarations?7-12
    • Q 7.23.2 : What is the insuring agreement?7-12
    • Q 7.23.3 : What are exclusions?7-13
    • Q 7.23.4 : What are definitions?7-13
    • Q 7.23.5 : What are conditions?7-13
    • Q 7.23.6 : What are endorsements?7-13
  • : Potential Problems with Disclosures7-13
  • Q 7.24 : What potential problems might we encounter with fiduciary liability claims?7-13
  • Q 7.25 : What are potential problems with disclosures on the insurance application?7-13
    • Q 7.25.1 : What is rescission?7-13
    • Q 7.25.2 : Do I have to provide information not requested on application?7-14
    • Q 7.25.3 : What happens if I do not answer a question?7-14
    • Q 7.25.4 : What happens if I give an incomplete answer?7-14
    • Q 7.25.5 : Can the insurance carrier rely on things not listed in our specific answers to the application?7-14
    • Q 7.25.6 : What is severability and why is it important to me?7-15
  • : Potential Definitional Problems7-15
  • Q 7.26 : Who is insured?7-15
    • Q 7.26.1 : What problems might arise with regard to who is insured?7-16
  • Q 7.27 : What is insured capacity?7-16
    • Q 7.27.1 : What qualifies as an insured subsidiary?7-16
    • Q 7.27.2 : How can we protect ourselves against confusion as to what entities are to be insured under the policy?7-17
  • : Claims7-17
  • Q 7.28 : What is a claim?7-17
    • Q 7.28.1 : Why is the definition of claim important?7-18
    • Q 7.28.2 : Does an investigative demand or governmental subpoena constitute a “claim”?7-18
    • Q 7.28.3 : Is a complaint seeking injunctive relief a claim?7-18
  • : Wrongful Acts7-18
  • Q 7.29 : What is a wrongful act?7-18
  • Q 7.30 : What does wrongful act mean in the insured person context?7-19
  • Q 7.31 : What happens when the allegations include both covered and non-covered acts?7-19
  • Q 7.32 : When must the wrongful acts have occurred to be covered?7-19
    • Q 7.32.1 : What does interrelated wrongful acts mean?7-20
  • : Loss7-20
  • Q 7.33 : What is loss?7-20
    • Q 7.33.1 : What is not included as loss?7-21
  • : Exclusions from Fiduciary Liability Policy7-21
  • Q 7.34 : What are significant exclusions?7-21
  • Q 7.35 : What does severability mean to us?7-21
  • Q 7.36 : What exclusions might apply?7-22
  • Q 7.37 : What are problems encountered with introductory phrases and exclusions?7-23
  • Q 7.38 : What are conduct exclusions?7-24
    • Q 7.38.1 : What is the personal profit or advantage exclusion?7-24
    • Q 7.38.2 : What is the dishonesty exclusion?7-24
    • Q 7.38.3 : What is the effect of the final adjudication language?7-25
    • Q 7.38.4 : What if one of the insureds under our fiduciary liability policy signs a confession admitting that he is guilty of criminal conduct?7-25
  • Q 7.39 : Does the bad conduct of one insured bar coverage for other insureds under the conduct exclusions?7-25
    • Q 7.39.1 : What is a severability of exclusions provision?7-26
    • Q 7.39.2 : If a court enters judgment against an insured under our fiduciary liability policy that establishes dishonesty or fraud, do we have to repay the costs of defense?7-26
    • Q 7.39.3 : If an insured agrees to settle a claim, does that mean that the insurer can claim that bad conduct has been established?7-27
    • Q 7.39.4 : Can the insurer sue an insured in a separate court action and get a judgment that the insured was guilty of dishonesty or fraud so as to avoid coverage?7-27
  • Q 7.40 : What is the insured versus insured exclusion?7-27
  • Q 7.41 : What is the pollution exclusion?7-27
  • Q 7.42 : What are other insurance exclusions?7-27
    • Q 7.42.1 : What is the employment practices exclusion?7-28
  • Q 7.43 : What is the prior acts exclusion?7-29
    • Q 7.43.1 : What is the prior notice exclusion?7-29
    • Q 7.43.2 : What problems arise with the prior notice exclusion?7-29
    • Q 7.43.3 : What is the prior or pending litigation exclusions?7-29
    • Q 7.43.4 : What is the bodily injury or loss of property exclusion?7-29
    • Q 7.43.5 : What kinds of problems might we encounter with other insurance exclusions?7-30
  • : Duties of the Insured7-30
  • Q 7.44 : What issues arise with claims?7-30
  • Q 7.45 : What are the duties of the insured in the event of a claim?7-31
  • Q 7.46 : What duty does the insured have with regard to providing notice of a claim?7-32
  • Q 7.47 : What triggers the duty to notify the insurer of a potential claim?7-33
  • Q 7.48 : If we have notice of a potential claim, how do we make sure we are covered?7-33
  • Q 7.49 : What is a notice of circumstance?7-33
  • Q 7.50 : What method of providing notice is required?7-34
  • Q 7.51 : What are the consequences of failure to give timely notice?7-34
  • Q 7.52 : What is the duty to cooperate?7-34
  • Q 7.53 : What are the most common issues encountered by insureds with regard to the duty of cooperation?7-35
  • : Selecting Counsel7-35
  • Q 7.54 : Who has the right to select counsel?7-35
  • Q 7.55 : What is panel counsel?7-35
  • Q 7.56 : Who does the insurer-appointed attorney represent?7-35
  • Q 7.57 : Should I be worried that the defense attorney is more interested in what the insurer wants than in what is best for me?7-35
  • Q 7.58 : Who controls the process of settlement?7-36
Chapter 8: Employment Practices Liability Insurance
  • : What and Who Are Covered by an EPLI Policy?8-2
  • Q 8.1 : What types of employment practices are covered under an EPLI policy?8-2
  • Q 8.2 : Who is covered?8-3
  • Q 8.3 : Does an EPLI policy cover punitive damages?8-3
  • : Particulars of an EPLI Policy8-3
  • Q 8.4 : Is there a standard form EPLI policy?8-3
  • Q 8.5 : Is the EPLI policy a claims-made policy?8-4
  • Q 8.6 : Is the EPLI policy a duty to defend policy?8-4
    • Q 8.6.1 : What is panel counsel?8-4
    • Q 8.6.2 : Do we have to use panel counsel if we already have employment law counsel?8-4
  • Q 8.7 : Who does the insurer-appointed attorney represent?8-5
  • Q 8.8 : Should we be worried the defense attorney is more interested in what the insurer wants than in what is best for us?8-5
  • Q 8.9 : What determines coverage under an EPLI policy?8-6
  • : Exclusions8-6
  • Q 8.10 : What are the typical exclusions in an EPLI policy?8-6
  • : Severability8-8
  • Q 8.11 : What is severability?8-8
  • Q 8.12 : Does the EPLI policy have severability of exclusions?8-8
  • Q 8.13 : Does the EPLI policy provide for severability of representations?8-8
  • : Claims That Trigger Coverage Under an EPLI Policy8-9
  • Q 8.14 : What is a claim under an EPLI policy?8-9
  • Q 8.15 : What kind of claims trigger coverage under an EPLI policy?8-10
  • Q 8.16 : What are the discrimination claims that are covered by an EPLI policy?8-11
  • : ADA8-11
  • Q 8.17 : What is the ADA?8-11
    • Q 8.17.1 : Do EPLI policies cover ADA claims?8-12
  • : Family and Medical Leave Act8-12
  • Q 8.18 : What is the Family and Medical Leave Act?8-12
    • Q 8.18.1 : Do EPLI policies cover FMLA claims?8-12
  • : ADEA8-12
  • Q 8.19 : What is the ADEA?8-12
    • Q 8.19.1 : Does an EPLI policy cover ADEA claims?8-13
  • : Sexual Harassment8-13
  • Q 8.20 : What is sexual harassment?8-13
    • Q 8.20.1 : Do EPLI policies cover harassment claims?8-14
  • : Wrongful Termination8-14
  • Q 8.21 : What are wrongful termination claims?8-14
  • : Immigration8-15
  • Q 8.22 : What are immigration claims?8-15
    • Q 8.22.1 : Do EPLI policies cover immigration claims?8-15
  • : Fair Labor Standards Act8-16
  • Q 8.23 : What is the Fair Labor Standards Act?8-16
    • Q 8.23.1 : Do EPLI policies cover FLSA claims?8-16
    • Q 8.23.2 : Are whistleblower claims related to FLSA covered?8-16
  • : WARN Act8-16
  • Q 8.24 : What is the WARN Act?8-16
    • Q 8.24.1 : Do EPLI policies cover WARN Act claims?8-17
  • : Sarbanes-Oxley or SOX8-17
  • Q 8.25 : What is Sarbanes-Oxley or SOX?8-17
    • Q 8.25.1 : Do EPLI policies cover SOX claims?8-17
  • : Defamation8-18
  • Q 8.26 : What are defamation claims and are they covered under an EPLI policy?8-18
  • : Invasion of Privacy8-19
  • Q 8.27 : What is invasion of privacy?8-19
    • Q 8.27.1 : Do EPLI policies cover claims for invasion of privacy?8-19
  • : Intentional Infliction of Emotional Distress8-20
  • Q 8.28 : Do EPLI policies cover claims for intentional infliction of emotional distress?8-20
  • : Definitions8-20
  • Q 8.29 : Who is insured under an EPLI policy?8-20
  • Q 8.30 : What is the typical insuring agreement in an EPLI policy?8-20
  • Q 8.31 : Who is an employee under the terms of an EPLI policy?8-21
  • Q 8.32 : What is loss?8-21
  • Q 8.33 : What are the duties of the insured in the event of a claim?8-22
  • Q 8.34 : What is a discovery period?8-22
  • Q 8.35 : What is a notice of circumstance?8-22
  • Q 8.36 : What are the duties of the insured with regard to settlement?8-23
  • Q 8.37 : What is a hammer clause?8-23
    • Q 8.37.1 : Is a hammer clause enforceable?8-23
    • Q 8.37.2 : What does a typical hammer clause look like?8-23
  • Q 8.38 : Should we buy excess EPLI coverage?8-24
Chapter 9: Excess Insurance
  • : Policies That Are Not Excess Insurance9-2
  • Q 9.1 : What is a primary insurance policy?9-2
  • Q 9.2 : What is the difference between an excess policy and an umbrella policy?9-2
    • Q 9.2.1 : Do umbrella policies contain a duty to defend?9-2
  • Q 9.3 : What is differences in conditions coverage?9-2
  • : Layers of Excess Coverage9-3
  • Q 9.4 : Does it make a difference if an insured elects to purchase numerous excess layers of coverage?9-3
  • Q 9.5 : Why purchase separate excess insurance instead of simply opting for higher policy limits?9-3
  • Q 9.6 : How does excess coverage work when there are several layers of insurance?9-3
  • : Types of Excess Policies9-4
  • Q 9.7 : What is a following form excess policy?9-4
  • Q 9.8 : What is a stand-alone excess policy?9-4
  • : How Does Excess Insurance Work?9-4
  • Q 9.9 : Does an excess policy contain a duty to defend?9-4
  • Q 9.10 : What is a quota share program?9-4
  • Q 9.11 : When must I notify my excess carrier of a potential claim?9-5
  • Q 9.12 : How might a coverage dispute with my primary carrier impact my excess coverage?9-5
  • Q 9.13 : How might settlement with an underlying insurer impact my excess coverage?9-5
  • Q 9.14 : If my primary carrier becomes insolvent can I then turn to my excess carrier?9-6
  • Q 9.15 : What is a shaving of limits endorsement?9-6
  • Q 9.16 : What is a most favored nation clause?9-6
  • Q 9.17 : If our settlement is less than the total primary insurance limits do we have to have the consent of the excess insurer?9-7
  • Q 9.18 : Does the primary insurance company have a duty to the excess insurance company in connection with settlement?9-7
  • Q 9.19 : What duty does the excess insurance company have to cooperate in the settlement or defense of a lawsuit against its insured?9-7
  • Q 9.20 : What is horizontal exhaustion?9-7
Chapter 10: Fidelity/Crime Insurance
  • : How Does Fidelity/Crime Insurance Work?10-2
  • Q 10.1 : What is fidelity coverage?10-2
    • Q 10.1.1 : What is the Financial Institution Bond?10-2
    • Q 10.1.2 : What does the Financial Institution Bond cover?10-2
    • Q 10.1.3 : What is the Commercial Crime Coverage Form?10-2
  • Q 10.2 : Why do we need to buy fidelity/crime insurance?10-3
  • Q 10.3 : Whose dishonest and fraudulent acts are covered by fidelity insurance policies?10-3
  • Q 10.4 : Who is typically insured under a fidelity policy?10-4
  • Q 10.5 : What is generally covered under fidelity/crime policies?10-4
    • Q 10.5.1 : What is employee theft coverage?10-4
    • Q 10.5.2 : What is premises coverage?10-4
    • Q 10.5.3 : What is in-transit coverage?10-5
    • Q 10.5.4 : What is forgery coverage?10-5
    • Q 10.5.5 : What is computer fraud coverage?10-5
    • Q 10.5.6 : What is funds transfer fraud coverage?10-5
    • Q 10.5.7 : What is money orders and counterfeit currency fraud coverage?10-5
    • Q 10.5.8 : What is credit card fraud coverage?10-6
    • Q 10.5.9 : What is client coverage?10-6
    • Q 10.5.10 : What is expense coverage?10-6
  • Q 10.6 : What are the typical exclusions to coverage under a fidelity policy?10-6
  • Q 10.7 : What are our duties if we discover a loss has occurred?10-7
  • Q 10.8 : What are some common issues that arise with fidelity/crime insurance?10-8
    • Q 10.8.1 : What issues arise with regard to discovery?10-8
    • Q 10.8.2 : What constitutes dishonesty?10-8
    • Q 10.8.3 : What problems arise with whether losses are direct or indirect?10-9
    • Q 10.8.4 : What kind of issues come up with on-premises coverage?10-9
    • Q 10.8.5 : What kind of issues arise concerning computer fraud coverage?10-9
Chapter 11: Cyber Liability Insurance
  • : When Data Breaches Occur11-3
  • Q 11.1 : What is cyber liability?11-3
    • Q 11.1.1 : How do data breaches occur?11-3
    • Q 11.1.2 : What is the likely fallout of a cyber breach?11-3
    • Q 11.1.3 : What is personally identifiable information?11-4
    • Q 11.1.4 : What is protected health information?11-4
    • Q 11.1.5 : What is health information?11-4
    • Q 11.1.6 : What is individually identifiable health information?11-4
    • Q 11.1.7 : What is personally identifiable financial information?11-5
    • Q 11.1.8 : What are the potential sources for a hacker to target?11-5
  • : Claims That Arise Out of Data Breaches11-6
  • Q 11.2 : What types of claims might arise out of data breaches?11-6
    • Q 11.2.1 : What kinds of claims are brought by customers?11-6
    • Q 11.2.2 : What types of allegations do customer-plaintiffs make?11-7
  • Q 11.3 : Who is at risk for claims arising out of a data breach?11-7
    • Q 11.3.1 : What is the risk for public companies?11-7
    • Q 11.3.2 : What is the risk for private companies?11-8
    • Q 11.3.3 : What is the risk for directors and officers?11-9
    • Q 11.3.4 : What is the risk for lawyers?11-9
    • Q 11.3.5 : What is the risk for financial advisors and financial institutions?11-10
    • Q 11.3.6 : What is the risk for health care professionals and entities?11-11
    • Q 11.3.7 : What is the risk for insurance companies?11-11
    • Q 11.3.8 : What is the risk for employers?11-12
  • : Protection Against Losses Incurred in a Data Breach11-12
  • Q 11.4 : What kind of insurance coverage do we need to protect against cyber liability?11-12
    • Q 11.4.1 : Can we rely on our Commercial General Liability policy alone?11-13
  • Q 11.5 : What is cyber insurance?11-13
    • Q 11.5.1 : What is the difference between cyber insurance and Technology Errors and Omissions Insurance?11-14
    • Q 11.5.2 : What does a typical stand-alone cyber insurance policy cover?11-14
    • Q 11.5.3 : What types of claims are covered by cyber insurance?11-15
    • : Important Cyber Policy Terms11-15
    • Q 11.5.4 : What is a record?11-15
    • Q 11.5.5 : What is a wrongful act?11-16
    • Q 11.5.6 : What is a claim?11-16
    • Q 11.5.7 : What is loss?11-17
    • Q 11.5.8 : What does direct loss mean and how does that affect our coverage?11-17
    • Q 11.5.9 : What is a privacy injury?11-17
    • Q 11.5.10 : What are privacy notification expenses?11-17
    • Q 11.5.11 : What is crisis management expense?11-18
    • Q 11.5.12 : What is business interruption loss?11-18
    • Q 11.5.13 : What is business income?11-18
    • Q 11.5.14 : What is E-theft loss?11-18
    • Q 11.5.15 : What is E-communications loss?11-18
    • Q 11.5.16 : What is E-threat expense coverage?11-19
    • Q 11.5.17 : What is E-vandalism expense?11-19
    • Q 11.5.18 : What is content injury?11-19
    • Q 11.5.19 : What is cloud failure coverage?11-20
    • Q 11.5.20 : What is notification cost reimbursement coverage?11-20
    • Q 11.5.21 : What is HI-TECH?11-20
    • Q 11.5.22 : Whose acts are covered?11-21
    • Q 11.5.23 : What incidents are covered?11-21
    • Q 11.5.24 : What is a cyber-attack?11-21
  • : Limitations and Exclusions11-21
  • Q 11.6 : How do insurers limit coverage in cyber insurance policies?11-21
    • Q 11.6.1 : What is the Failure to Follow Minimum Required Practices Exclusion?11-22
    • Q 11.6.2 : What is the retroactive date exclusion?11-22
    • Q 11.6.3 : What is the contract exclusion?11-22
  • : Considerations in Purchasing Cyber Insurance11-23
  • Q 11.7 : What should we consider in buying cyber insurance?11-23
    • Q 11.7.1 : Should we buy a duty to defend or an indemnity policy?11-23
    • Q 11.7.2 : Is it possible to just add an endorsement to our professional liability/E&O policy to cover a data breach?11-23
    • Q 11.7.3 : Can we obtain coverage for acts and omissions of our vendors?11-24
    • Q 11.7.4 : What should the policy definition of territory include?11-24
    • Q 11.7.5 : Should we buy business interruption coverage?11-24
    • Q 11.7.6 : Is there anything we can do to rectify the retroactive date exclusion problem?11-24
    • Q 11.7.7 : What should we know about allocation of costs?11-25
    • Q 11.7.8 : Is subrogation a problem with cyber insurance?11-25
    • Q 11.7.9 : What limits should we carry on cyber insurance?11-26
Chapter 12: Claims
  • : Notice Requirements12-2
  • Q 12.1 : What happens if we fail to give timely notice?12-2
  • Q 12.2 : What types of events should put me on claim-alert?12-2
  • Q 12.3 : Whom do we notify?12-3
  • Q 12.4 : Is there any required method of notice?12-3
  • Q 12.5 : How can our broker help us?12-4
  • Q 12.6 : When do we hire an attorney?12-5
  • : Duties to Defend, Cooperate, and Indemnify12-5
  • Q 12.7 : Who controls the process of responding to and handling a claim?12-5
  • Q 12.8 : Are there any special controls we should implement when the claim comes in?12-6
  • Q 12.9 : What is the duty of cooperation?12-7
  • Q 12.10 : Can we make an offer to settle the claim without notifying the insurer?12-7
  • Q 12.11 : What is the difference between the duty to defend and the duty to indemnify?12-8
  • : Coverage Disputes12-8
  • Q 12.12 : What is a coverage dispute?12-8
    • Q 12.12.1 : How does a coverage dispute affect the duty to defend?12-8
    • Q 12.12.2 : What is a reservation of rights letter?12-9
    • Q 12.12.3 : What is a non-waiver agreement?12-10
    • Q 12.12.4 : What is an interim funding agreement, and do I have to sign it?12-10
    • Q 12.12.5 : What is rescission?12-11
    • Q 12.12.6 : What is a declaratory judgment?12-11
  • Q 12.13 : If the insurance company sues me for declaratory judgment, who bears the costs of defending against that action?12-11
  • Q 12.14 : What is bad faith?12-12
  • Q 12.15 : What is allocation?12-13
  • : Settlements12-14
  • Q 12.16 : How do we work with the insurance carrier in connection with potentially settling the claim against us?12-14
  • Q 12.17 : If my policy is an indemnity policy rather than a duty to defend policy, can I settle the claim without the insurance company’s agreement?12-14
  • Q 12.18 : What problems arise when there are multiple insurance policies that may cover a given loss?12-14
  Index

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