Excess insurance, while great for mitigating risks of large losses to policyholders, does not always cooperate during litigation.  This is particularly true during settlement negotiations, as excess insurers do not have an obligation to settle in good faith until it’s their turn to defend. This was the decision of the Seventh Circuit in Fox v. Am. Alt. Ins. Corp., 757 F.3d 680 (7th Cir. 2014). In Fox, the plaintiff twice made demands for settlement, both before and after a jury verdict came down, that was in excess of the primary policy. But, as the excess insurer had no duty to defend until the primary policy was “exhausted,” meaning actually paid out, the Seventh Circuit found that in neither demand had the excess insurer violated their duty to settle in good faith.

Continue Reading Bringing Excess Insurance Carriers to the Settlement Table

The Midwest is experiencing record-breaking flooding this year, bringing back memories of the devastating and costly floods of 1993.  Without a doubt, business losses and business interruption claims will be substantial.  This post explores when an insured might have coverage for business interruption even if it does not incur significant flood-damage to its own property.  As with any coverage claim, the merits will depend on the specific language in the policy and the specific circumstances of the claimed loss.  But, here’s a rundown of some common policy provisions and issues to keep in mind.

Continue Reading Record-Breaking Flooding in the Midwest Likely Means a Flood of Business Interruption Claims, Too

This month, when many are working with inspiration towards their New Year’s resolutions, we urge each business policyholder to set a goal fitting of our modern high-tech age: checking its cyber insurance.

Cyber insurance is something of a fluid catch-all term, but insureds generally seek it to provide coverage for computer-based perils, such as those arising from unauthorized computer access (“hacking”), malicious software (“malware”), email fraud (“phishing” or “spoofing”), network failure or inaccessibility (“ransomware”), and the resulting breach or disclosure of protected data. Such insurance can be either first-party (covering the insured’s own losses arising from, say, a computer system malfunction, a disgruntled employee, or a cyber criminal) or third-party (covering the insured’s liability to, say, its consumers for a data breach or the government for regulatory fines).


Continue Reading Cyber Insurance: Something All Businesses Should Consider