The increased regulatory activity and private litigation activity surrounding the climate change issue suggests future increased liabilities. While the treatment of liability for climate change related issues by the courts and governmental entities is in an early stage of evolution, the liability and regulatory machinery are grinding forward. Ensuring that corporate indemnities and insurance are in place to respond is an important step.

For more on this emerging risk, read the complete article, only on RMmagazine.com.

EPLI policies are relatively new, having been introduced less than 20 years ago. Although an approved ISO form EPLI policy exists, EPLI policies are most often sold as manuscript policies and can have varying coverage terms and exclusions. Because EPLI policies are not uniform, a policyholder must carefully read a proposed policy prior to purchase. The key is assessing whether, based upon the policyholder’s business, the policy will provide coverage for the employment claims that it is most likely to deal with and for whom such coverage will be provided.

Whether EPLI policies are new to you or if you simply need a refresher, don’t miss this informative article only on RMmagazine.com.

1. Recognize the construction contract as the bedrock of risk management.
The contract documents are the place for agreements to provide insurance, as well as additional insured provisions, indemnity and exculpation clauses. They are also the place to make clear which parties are responsible for the many surprises that arise during the course of construction, from latent subsurface conditions to accidents and failures to construct the project in the manner that the owners and designers intended.

For more, check out the rest of the article, only on RMmagazine.com.

Many forms of liability insurance protect against invasion of privacy claims. Should a policyholder be confronted by such a claim, umbrella insurance, general liability insurance, errors and omissions policies and other stand-alone specialty insurance policies should be checked for potential coverage. More proactively, if an insurance portfolio review reveals that those provisions have been written out of the businesses’ portfolio of insurance, the broker should be enlisted to get those increasingly important coverages back in.

For more, read the entire article, only on RMmagazine.com

In one recent case, for example, a policyholder was the victim of a computer hacker. The insurance company refused to pay the claim, but the court rejected the insurers attempts to evade payment and ruled that the policyholder was entitled to crime coverage for the theft of customer data.

Such a ruling is not only supported by the language of many crime policies (which often contain a provision indicating that they provide coverage for the theft of property not owned but in the possession of the policyholder), but also by numerous crime insurance coverage cases over the decades.

For more on this important coverage issue, check out the rest of the article, only on RMmagazine.com.

Meanwhile, the Obama administration has begun civil and criminal investigations into the circumstances surrounding the spill, intending to prosecute any responsible parties to the “fullest extent of the law.”

One person briefed on the inquiry said it was in an early stage and that no subpoenas had been issued yet to BP, the owner of the well. It was unclear whether any had gone to Transocean, which leased the Deepwater Horizon, the nine-year-old drilling rig that exploded and sank in April, to BP; Cameron, the company that manufactured a “blowout preventer” that failed to function after the explosion; or Halliburton, which performed drilling services like cementing.

Administration officials said they were reviewing violations of the Clean Water Act, which carries criminal and civil penalties and fines; the Oil Pollution Act of 1990, which can be used to hold parties responsible for cleanup costs; the Migratory Bird Treaty Act and the Endangered Species Act, which provide penalties for injury and death of wildlife.

In addition to its inability to stop the oil from gushing into the the Gulf, some of BP’s comments have not helped it to garner public sympathy. When reports recently surfaced that cleanup workers were experiencing nosebleeds, headaches, nausea, vomiting and shortness of breath – symptoms that are evidently similar to exposure to the chemical dispersant that BP is using – BP CEO Tony Hayward dismissed the illness as food poisoning. Food poisoning experts have disagreed with Hayward’s assessment and have pointed to a lack of proper safety equipment.

“These do not sound like the symptoms my clients typically suffer, ” said nationally-known food safety attorney Bill Marler. “It’s not that I wouldn’t mind suing BP.”

Of greater concern perhaps is the long-term environmental and economic impact this disaster will have. Although the outcome is still unknown, it is almost certain to be devastating. For businesses in the Gulf area it will be important to understand their insurance coverage . To that end, be sure to check out Anderson Kill & Olick’s latest online Fine Print column in Risk Management magazine. Originally the subject of an AKO Policyholder Alert, the article discusses the policies that could be in play for your company.

The massive losses are covered by a variety of insurance policies already purchased by those being harmed. First party property and business interruption (BI) insurance certainly will provide coverage for certain losses. Liability insurance, both general liability and pollution liability policies, will provide defense and indemnity for lawsuits. Directors and officers insurance also will provide coverage for derivative lawsuits against directors and officers.

Be sure to check it out and stay tuned to the Risk Management Monitor for more updates.

Most D&O insurance policies promise some measure of insurance protection against “regulatory and governmental” investigations, “administrative or regulatory proceedings” and criminal proceedings. However, many insurance companies will argue this coverage is not triggered until certain documents are prepared by the investigating entity and until they are prepared and drafted in a very specific way. For instance, does the investigation start when a subpoena is served or only when a “formal” investigative order is issued under the insurance policy? Insurance companies may argue that they are not on the hook for millions of dollars in “loss” until certain specific aspects of the investigation come to pass.

Considering the importance of D&O coverage for senior management, you won’t want to miss this online exclusive, only on RMmagazine.com.

Changes to policy wording are most likely to be accepted during soft markets like the one that has existed over the past several years. Although in theory, underwriters price policies based on the specific risks being transferred via the actual policy, in practice, due to competition from other insurance companies, lack of effort or both, it is usually the case that requested changes to policy wording usually do not result in corresponding changes to premium. Essentially, the underwriter agrees to “throw in” the broadened coverage in order to keep the policyholder’s business.

For more about how to go about revising your policy in your favor, click here to read the full article on RMMagazine.com.

In the context of product recall insurance coverage, some insurance companies may attempt to avoid coverage for a product recall losses by arguing that there is no evidence that the product in question did or would cause bodily injuries or damage. Specifically, the insurance company may argue that to trigger coverage, the use or consumption of the product must have resulted or would result in identifiable bodily injury, sickness, disease or death. Such insurance company arguments place the policyholder in an awkward position: namely, in an effort to establish coverage, the policyholder is being urged by the insurance company to evidence just how toxic its product was or could potentially be.

For important advice that will help you get your business back to normal in the event of a costly product recall, click here to read the full article exclusively on RMMagazine.com.