Global Warming: Will There Be Exposure for Directors and Officers and Will It Be Covered?

This article will explore the potential legal liabilities of corporate officers and directors due to the effects of global warming on the business of their corporation, as well as the insurance coverage issues likely to arise under directors' and officers' (D&O) liability policies in light of those liabilities. The article focuses particularly on the pollution exclusion and the bodily injury and property damage exclusions, and also explores scenarios that may engender attempts by insurers to rescind the policy.     

论我国海外投资保险制度的构建

海外投资保险制度是资本输出国为了保护本国海外投资、消除本国国民海外投资的政治风险而建立的一种保护制度。保险人和保险范围是构建海外投资保险制度中两个非常重要的问题。在我国，海外投资活动尽管开展得较晚，但其发展却极为迅速，然而，目前我国尚未建立起发达国家所普遍实行的海外投资保险制度。我国在建立海外投资保险制度中，保险人的资格应采取将直接投资的管理、审批机构与具体承办海外投资保险业务的保险机构分开成立的方式，保险范围除了各国一般承保的征收险、外汇险以及战争险，还应包括违约风险、恐怖主义风险以及营业中断风险。     

Hackers Are After More than Just Data: Will Your Company's Property Policies Respond When Cyber Attacks Cause Physical Damage and Shut Down Operations?

Recent attention on high profile data breaches has overshadowed a potentially greater risk: cyber attacks on large industrial companies causing physical damage, potentially releasing contaminants, and shutting down operations. A handful of publicly reported cyber-attacks, including explosions at an oil pipeline and a steel mill, have highlighted the potential vulnerability of these companies' internet-facing industrial control systems to hackers. The insurance industry has reacted to the growing risk of privacy-related data breaches by marketing and selling so-called “cyber policies.” But these policies typically exclude coverage for property damage and are ill-suited to cover the magnitude of business interruption losses that could result from an extended shutdown of a large industrial operation. That leaves policyholders to look to their traditional property policies. This article examines the cyber-attack risk that large industrial companies face and how those companies' traditional property insurance policies may help mitigate that risk.     

Old Assets,New Tricks: Insurance Portfolio Management in the Twenty-First Century

Two decades of rapid acceleration in the pace of merger and acquisition activity on the one hand, and litigation on the other, has led to broad recognition of the value of a company's portfolio of historic insurance assets. This article examines the trends in litigation, insurance industry practice, and mergers and acquisitions that are turning insurance portfolio management into a core component of risk management. It then outlines the new tools and techniques developed to document missing policies and to maintain quick access to the entire insurance portfolio. The return on investment is dramatic. Millions of dollars of coverage will be preserved and at the ready.     

Environmental Claims – Battlefield Tested Tips and Ways to Improve your Overall Claims Experience

This article provides an insurance brokers' perspective on how an Insured can best protect its coverage in the event of a pollution claim. While policy negotiations during underwriting will set coverage, keeping coverage throughout the claim is equally as important. Having early and consistent communications between the Insured and its insurance carrier is critically important and a necessary part of keeping a covered claim covered.     

Invitation or Ambush: The Scope of an Insured's Duty to Cooperate and the Slippery Slope of Information Sharing

The policyholder's “duty to cooperate” is built into every liability insurance policy, either expressly or through the application of a state's common law. The scope of an insured's duty to cooperate is often difficult to discern, however, in terms of the type and extent of information that the insured should provide as part of the insurer's investigation of the underlying matter for which coverage is being sought. Traditionally, the duty to cooperate was intended to encourage information sharing to allow the insurer to afford the policyholder a comprehensive, informed defense to the underlying claimant's allegations. This article examines the scope of the duty to cooperate and how that duty impacts the insured's obligation to share some reasonable amount of information as part of the insurer's investigation and defense of the underlying claim, noting potential pitfalls and risks that may arise from information sharing.     

Cyber-insurance in EU policy-making: Regulatory options,the market's challenges and the US example

Over the last decades digital technologies have penetrated our daily lives affecting all aspects of our societal and economic activities. Even though the benefits of relying on information systems to run everyday tasks, organise one's business, interact with each other or enjoy public services are undisputable, the increasing use of digital technologies comes with a price: the growing exposure to cyber risks. This new type of threat has been in the center of the EU agenda for over 15 years during which a solid legislative framework for the protection S of network and information systems against cyber incidents has been developed. However, security and resilience of infrastructures and networks is one parameter of the challenge. Dealing with the financial risk emerging from a cyber incident, is another, equally important one. The need to mitigate these risks led to the emergence of a new insurance market, the cyber insurance market. Despite though the constantly growing demand for this type of insurance coverage, the market is still under development. The fast-evolving nature of cyber threats, the lack of a common language as regards risks, losses and coverages and the lack of historical data on cyber incidents are listed among the factors that slow down the market's growth. Currently, all involved stakeholders in the insurance field are considering specific initiatives that would accelerate the process of turning the EU market more competitive and efficient against its many challenges. The example of the US cyber insurance market, with its shortcomings and know-how, could also contribute to this effort, as an example of a market that has been intensively facing these challenges for almost twenty years.     

Busting the Myth of the Unavailability of Insurance Rule's Application to Loss Allocation for Pollution Liability Claims Since 1986

Tens of millions of dollars in pollution liability losses have been mistakenly allocated to general liability insurers under the “Unavailability of Insurance” rule in jurisdictions that employ it. Under this rule, a policyholder is not allocated losses for years when they claim that pollution liability was unavailable – mainly after the advent of the 1986 “absolute” pollution exclusion. Recent research has been compiled to include thousands of pages of evidence that by 1986 and to this date there was and has been a viable pollution liability insurance market that would not only underwrite a current year's risks, but also erase any prior pollution insurance coverage gaps by insuring decades of prior acts. This article looks at this rule and the enormous impact it could have on insurers' pollution liability reserves if it continues to be misapplied.     

Insurance Coverage for Environmental Claims: Current Litigation Issues in the United States

The insurance industry introduced exclusions for environmental claims in the general commercial litigation policies in the early 1970s, and introduced even greater restrictions in the 1980s. Litigation over the two most common pollution exclusions has been robust and will likely continue to increase. This article first briefly reviews the history of insurance coverage for environmental claims in the United States, including the most common issues and how the courts have addressed them. The article then discusses the current issues and emerging trends in insurance coverage for environmental claims under the general commercial policies. Finally, there is a brief discussion on the growing market for insurance products that specifically cover (rather than exclude) environmental claims.     

Prevention for those who can pay: insurance reimbursement of genetic-based preventive interventions in the liminal state between health and disease

Clinical use of genetic testing to predict adult onset conditions allows individuals to minimize or circumvent disease when preventive medical interventions are available. Recent policy recommendations and changes expand patient access to information about asymptomatic genetic conditions and create mechanisms for expanded insurance coverage for genetic tests. The American College of Medical Genetics and Genomics (ACMG) recommends that laboratories provide incidental findings of medically actionable genetic variants after whole genome sequencing. The Patient Protection and Affordable Care Act (ACA) established mechanisms to mandate coverage for genetic tests, such as BRCA. The ACA and ACMG, however, do not address insurance coverage for preventive interventions. These policies equate access to testing as access to prevention, without exploring the accessibility and affordability of interventions. In reality, insurance coverage for preventive interventions in asymptomatic adults is variable given the US health insurance system''s focus on treatment. Health disparities will be exacerbated if only privileged segments of society can access preventive interventions, such as prophylactic surgeries, screenings, or medication. To ensure equitable access to interventions, federal or state legislatures should mandate insurance coverage for both predictive genetic testing and recommended follow-up interventions included in a list established by an expert panel or regulatory body.     

Secrecy and Seclusion: Developments in Privacy Insurance Law

Privacy has become big news. Our society has an epidemic of identity theft, loss of personal data, blast faxing, and data mining. The wave of new privacy litigation has led to a wave of privacy insurance litigation, particularly with respect to coverage for blast faxes—unsolicited and unwanted facsimiles which bombard businesses and individuals. The main debate results from the fact that while the advertising injury section of the general liability policy provides some coverage for invasion of privacy, the new privacy causes of action do not necessarily fit the insurance policy's coverage. For example, while blast faxes invade the recipient's privacy or seclusion, insurers assert that the faxes do not involve the publication of secret material. To meet this problem, insurers are writing new tech or cyber policies that provide far more expansive coverage for privacy.     

The Meaning of Champion Dyeing and Finishing: EIL Insurance Must Be Available in the Year That the Precise Risk Manifested Itself

Champion Dyeing & Finishing Co., Inc. v. Centennial Insurance Company and North River Insurance Company, decided in November 2002, represents a decisive victory for policy holders in environmental coverage litigation involving the availability of EIL insurance after 1985 or 1986. EIL coverage was generally unavailable after 1985 and until 1995, particularly for old leaking underground storage tanks (UST's). The availability issue arises in environmental coverage cases where the court adopts a prorata rather than joint and several theory of allocating responsibility for cleanup costs, and when in such cases there are periods of no insurance, because, for example of the insertion of the absolute pollution exclusion in commercial general liability (CGL) policies. In those circumstances, the courts apply the “willing self-insurer” rule and allocate responsibility to the insured who willingly decided to retain the risk. Until Champion Dyeing, there was little guidance about how to determine availability in the context of site-specific environmental pollution. The case was part of a 1998 declaratory judgment action by a small manufacturing company seeking reimbursement for cleanup costs attributable to pollution from two fuel oil storage tanks found leaking in November 1997. Reversing the trial court's decision, the New Jersey appellate court found that defendants failed to prove insurance available to the insured in 1997 and that therefore the duty to indemnify should have been apportioned solely among the insurers. In doing so, it stressed the necessity of demonstrating that insurance could have been purchased covering the precise risk that manifested, not simply that EIL insurance covering undefined risks was available. Its rationale was based on a recognition of the two essential differences between EIL and CGL insurance: claims made trigger of coverage and coverage of specific pollution conditions rather than generalized occurrences. In addition, testimony at trial failed to demonstrate the availability in 1997 of insurance providing coverage for the risk at issue because the testimony at the insurer's expert lacked foundation. This decision indicates that, in order to prove or disprove availability, the parties must first hire a competent environmental insurance expert and then must ask and answer three questions: What policies were being issued in the market that applied to the particular type of risk during the relevant time period, and especially in the year that the risk manifested? Would the insured have been able to purchase one of these policies or endorsements for its particular risk? Would the policy terms have provided coverage for the specific manifested risk in question? After applying these three questions to a number of hypotheticals with typical fact patterns, it is evident how impossible it is to prove coverage available for UST risks such as in the Champion case and how extremely difficult it will be to do so for non-UST, generally-site specific risks.     

Two “Wrongs” Make a Right to Coverage: When Waiver or Estoppel Precludes an Insurer's Breach of Cooperation Defense

Liability insurance policies almost always contain a provision requiring the policyholder to cooperate with the insurance company in various ways. An insured's failure to comply with such a condition may preclude coverage. When an insurer asserts a breach of the cooperation provision defense to a claim for coverage, however, the insured may counter that the insurer either waived, or is estopped from relying on, the cooperation provision. This article provides a brief outline of waiver/estoppel issues to be considered in evaluating an insurer's conduct when it asserts a non-cooperation defense.

“When you point your finger at someone, three fingers are pointing back at you.”

—Anonymous     

Promoting Urban Agriculture: Insurance as an Important Tool

As population density and climate change affect food supplies, urban agriculture becomes increasingly important. Insurance is just one component of managing the risks associated with these changes and of helping the agriculture sector adapt to them. Research to date indicates that insurance, public policy, and land use law must effectively be combined in order for urban agricultural initiatives to flourish. However, financial support is another crucial element that too often is overlooked. This article discusses the deployment of various insurance products as a means to facilitate and create incentives to encourage urban agriculture. This promising business may be promoted by adjusting existing insurance coverage, establishing local urban agriculture insurance programs, and incorporating risk analysis into urban land use planning.     

Hot Air: The Impact on the Insurance Industry from Climate Change Disclosure Rules

This article addresses certain recent rules and regulations promulgated by the Securities and Exchange Commission requiring companies to disclose the risks presented to their business from climate change. It subsequently examines how these added risks may impact the insurance industry—specifically with regard to director and officer liability. In the author's view, climate change will bring a tectonic shift to industries worldwide and a potential avenue for liability in the insurance industry may be able to circumvent standard pollution exclusion language by making claims under director and officer policies.     

Tort,Insurance and Ideology: Further Thoughts

This article explores the impact of insurance arrangements on the development of the law of obligations. It is accepted orthodoxy that the existence or otherwise of a duty of care in tort should be determined independently of the parties' underlying insurance arrangements. This article suggests that the traditional analysis is of limited value only, in that it fails to take full account of contractual arrangements which rest upon risk allocation backed by insurance; of the circumstances in which duties of care may arise; and of the relevance of insurance to the determination of the standard of care and causation principles. It is further suggested that insurance has a much greater part to play in the spreading of losses arising out of private suits than has to date been fully appreciated.     

WHEN IT HAPPENS IN A FAMILY: AIDING PARENTS OF SUBSTANCE‐ABUSING ADOLESCENTS*

This article first summarizes key data on the scope of teen substance abuse and the lack of teen access to needed treatment services. It then describes how and why attorneys may be helpful to parents who discover their teen's drug or alcohol problem and seek advice and counsel about the legal implications of various actions that can or may be taken. The article explores such issues as parents finding illegal drugs in the house or on their teen's person, various modalities of treatment and how family members are involved, how parents might secure residential evaluations for their youth without the necessity of juvenile court involvement (and why this is important), concerns about placing youth in unlicensed residential treatment facilities, health insurance coverage issues, home drug testing, and how past American Bar Association (ABA) policy on youth drug and alcohol abuse is being followed up with a new ABA project to aid parents of substance‐abusing teenagers and their families.     

Governing Condominiums and Renters with Legal Knowledge Flows and External Institutions

This article explores the intertwined roles of legal knowledge and external institutions in condominium governance using a sociology of governance framework. Condominium legislation spread in North America in the 1960s. By the 1970s, renters had become the condominium's primary “other.” The article elaborates legal governance and strategies of property management and private insurance that converge on renters in condominiums. Through this analysis, the renter category is shown to be one point of convergence of mutually reinforcing institutional processes of juridification, commodification, and risk avoidance. Condominium governance is revealed as more complex, heterogeneous, and dependent upon legal knowledge flows through channels and “excerpting” practices beyond the courts, and upon external institutions beyond statute‐mandated condominium boards, than previously acknowledged. Implications for critical legal studies and condominium governance policy are discussed.     

Foul weather friends: big business and health care reform in the 1990s in historical perspective

Existing accounts of the Clinton health reform efforts of the early 1990s neglect to examine how the change in big business reform interests during the short period between the late 1980s and 1994 might have altered the trajectory of compulsory health insurance legislation in Congress. This article explores evidence that big employers lost their early interest in reform because they believed their private remedies for bringing down health cost inflation were finally beginning to work. This had a discouraging effect on reform efforts. Historical analysis shows how hard times during the Great Depression also aligned big business interests with those of reformers seeking compulsory social insurance. Unlike the present case, however, the economic climate did not quickly improve, and the social insurance reform of the New Deal succeeded. The article speculates, therefore, that had employer health expenditures not flattened out, continuing and even growing big business support might have neutralized small business and other opposition that contributed heavily to the failure of reform. Thus in light of the Clinton administration's demonstrated willingness to compromise with business on details of its plan, some kind of major reform might have succeeded.     

How to Prepare for the Hurricane Season and Avoid Being Underinsured for Business Interruption Coverage,and a Special Section on “What to Do If You Have Loss of Income from the BP Oil Spill”

Most chief financial officers (CFOs) and risk managers have an understanding of their property and liability insurance needs and are comfortable purchasing coverage that protects their companies from a loss due to an insured peril. However, it has been our experience that their comfort level declines dramatically when it comes to business interruption coverage and limits. The uncertainty surrounding business interruption coverage, extensions of coverage, and respective limits of that coverage consistently results in many organizations finding themselves underinsured and short of cash when faced with a major loss. How can you, the CFO or risk manager, avoid that day of reckoning when your company cannot afford the economic consequences of an underinsured loss? Plus, what to do if you have a business income loss from the Gulf Oil Spill.