• Share
  • Email
  • Embed
  • Like
  • Save
  • Private Content
Buried Treasure: Finding Resources In Your Insurance Policies
 

Buried Treasure: Finding Resources In Your Insurance Policies

on

  • 409 views

These are slides for a presentation that two of my partners and I gave last week to the Japan American Society of Georgia. The presentation focuses on how companies, particularly manufacturers, can ...

These are slides for a presentation that two of my partners and I gave last week to the Japan American Society of Georgia. The presentation focuses on how companies, particularly manufacturers, can find hidden resources in their insurance policies. For example, policies that are decades old may provide coverage for claims made today for environmental and asbestos claims. Companies can also potentially save hundreds of thousands of dollars through defense obligations in their current policies. The presentation also covered potential gaps in coverage due to increasing exclusions in general liability policies, and the need for companies to have an experienced and proactive agent or broker willing to take the time to understand their business and its risk profile.

Statistics

Views

Total Views
409
Views on SlideShare
409
Embed Views
0

Actions

Likes
0
Downloads
3
Comments
0

0 Embeds 0

No embeds

Accessibility

Categories

Upload Details

Uploaded via as Microsoft PowerPoint

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Buried Treasure: Finding Resources In Your Insurance Policies Buried Treasure: Finding Resources In Your Insurance Policies Presentation Transcript

    • Buried Treasure: John L. Watkins Mari Yamamoto Regnier john.watkins@btlaw.com mari.regnier@btlaw.com Finding Resources in 3475 Piedmont Road, N.E. Suite 1700 Atlanta, Georgia 30305 One North Wacker Drive Suite 4400 Chicago, Illinois 60606-2833 Your Insurance (404) 264-4043 (Direct) (404) 663-0538 (Cell) (312) 214-8335 (Direct) Policies ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIOINDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC ATLANTA CHICAGO DELAWARE WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All RightsRights Reserved. page, page, and all information is confidential, proprietary and the property of Barnes & Thornburg LLP, which which may not be disseminated or disclosed to anyone than an employee or partner of © 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Reserved. This This and all information on it, on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, may not be disseminated or disclosed to anyone other other than an employee or partner ofBarnes & Thornburg LLP who iswho is authorized to receive it. page and all information on it mayit may not be reproduced, in any by anyone without the express written consent of the of the author or presenter. Barnes & Thornburg LLP authorized to receive it. This This page and all information on not be reproduced, in any form, form, by anyone without the express written consent author or presenter.
    • Are You Sitting on Buried Treasure? ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 2012 CONFIDENTIAL Barnes & Thornburg All Rights Reserved. This page,page,all information on it, onconfidential, proprietary and the property of Barnes & Thornburg LLP, whichwhich not be disseminated or disclosed to anyone other other an employee or partner of © CONFIDENTIAL Barnes & Thornburg LLP. LLP. All Rights Reserved. This and and all information is it, is confidential, proprietary and the property of Barnes & Thornburg LLP, may may not be disseminated or disclosed to anyone than than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page pageall information on it may not be reproduced, in any form, form, by anyone without the express written consent of the author or presenter. Barnes & Thornburg LLP who is authorized to receive it. This and and all information on it may not be reproduced, in any by anyone without the express written consent of the author or presenter. 2
    • Your Insurance Policies May Provide Hidden Resources ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Reserved. This page, and all and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP,may not be disseminated or disclosed to anyoneanyone other than an employee or partner of CONFIDENTIAL Barnes & Thornburg LLP. All Rights Rights Reserved. This page, information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which which may not be disseminated or disclosed to other than an employee or partner ofBarnes Barnes & Thornburg LLP authorized to receivereceive it. This page and all information on not be reproduced, in any form, by anyoneanyone without the express consent of the author or presenter. & Thornburg LLP who is who is authorized to it. This page and all information on it may it may not be reproduced, in any form, by without the express written written consent of the author or presenter. 3
    • This Presentation Will Help You Find It! • How policies cover claims • Unexpected claims your policies may cover • Possible gaps in your coverage • Common sense steps to protect your business ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 4
    • Caution! • This presentation will not make you an expert • Insurance is complicated • Just about every “rule” has an exception! • Goal is to increase your awareness of insurance resources • Get professional advice from your own jurisdiction! ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 5
    • The Basics: How Liability Policies Are Structured • Policies typically are written for one year periods – And renewed or replaced every year • “Occurrence” policies typically include: – Commercial general liability – Excess liability (sometimes “umbrella”) – Motor vehicle policies (“accident”) • “Claims made” policies typically include: – Professional liability (malpractice; errors and omissions) – D&O policies – Environmental liability coverage ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 6
    • “Occurrence” vs. “Claims Made” • “Occurrence” policies cover liabilities: – Resulting from an “occurrence” (an act or omission, accident or event) – That happens during an annual policy period – Regardless of when the claim or lawsuit is asserted • “Claims made” policies cover “claims” (demand for money or lawsuit): – Made (and usually reported) during the policy period – Regardless of when the act or omission happened – But subject to the “retro date” ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 7
    • Occurrence Policy: How It WorksPolicy Period Begins (12/ 01/ 2010) Policy Period Ends (12/ 01/ 2011)2010 2011 2012 2013 2014 "Occurrence" (07/ 01/ 2011) Claim or Law suit (11/ 01/ 2013) ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC © 20122012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, all information on it,on it, is confidential, proprietary the property of Barnes & Thornburg LLP,LLP, which maybe disseminated or disclosed to anyone other than than an employee or partner of © CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and and all information is confidential, proprietary and and the property of Barnes & Thornburg which may not not be disseminated or disclosed to anyone other an employee or partner of Barnes & Thornburg LLP LLP who is authorized to receive it. This page all information on it on it maybe reproduced, in any form, by anyone without the express written consent of the author or presenter. Barnes & Thornburg who is authorized to receive it. This page and and all information may not not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 8
    • Claims Made Policy: How It Works Policy Period Begins (12/01/2010) Policy Period Ends (12/01/2011)Retro Date (01/01/2005)2005 2006 2007 2008 2009 2010 2011 2012 2013 Act or Ommission Claim Asserted (08/11/2011) ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC © 2012© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Reserved. This page, and all and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP,may not be disseminated or disclosed to anyoneanyone other than an employee or partner of CONFIDENTIAL Barnes & Thornburg LLP. All Rights Rights Reserved. This page, information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which which may not be disseminated or disclosed to other than an employee or partner of Barnes Barnes & Thornburg LLP authorized to receivereceive it. This page and all information on not be reproduced, in any form, by anyoneanyone without the express consent of the author or presenter. & Thornburg LLP who is who is authorized to it. This page and all information on it may it may not be reproduced, in any form, by without the express written written consent of the author or presenter. 9
    • Occurrence vs. Claims Made: What It Means • Occurrence policies can cover claims made decades after the policy was written • “Claims made” policies were developed by insurers to avoid “long tail” risks ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 10
    • Buried Treasure in Old Insurance Policies • Most occurrence policies (CGL and excess) provide coverage for claims for “bodily injury” (including death) or property damage subject to stated exclusions • Older policies often have broader coverage with fewer exclusions • “Long tail” risks that may be covered include: – Environmental claims • For example, old plant sites – Asbestos claims  Note: Plaintiff’s lawyers are now on third or fourth tier targets  Companies with little obvious risk may have exposure ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 11
    • Most Likely “Treasure Hunters” • Companies long-term on-going operations – Paper and wood product companies – Chemical companies – Manufacturing companies – Utilities • Do not forget about mergers and acquisitions! – Insurance review should be part of “due diligence” ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 12
    • Buried Treasure: Defense Costs • Never assume a claim is not covered – Insurer’s basic obligations usually include providing a defense and paying claims and judgments • Basic rule: If any part of a lawsuit is potentially covered, the insurer must defend the entire case – Obligation to defend is broader than obligation to indemnify – Defense obligation can save hundreds of thousands of dollars ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 13
    • Buried Treasure: Unexpected Coverage • Insurance coverage is not intuitive • Types of claims that may be covered – Construction defects – Defamation (libel and slander) – Trade secret violations – Breach of contract (if coupled with negligence allegations) – Breach of fiduciary duty • Always assume a claim may be covered ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 14
    • Current Coverage Issues: Buyer Beware! • The on-going game: – Courts find claims are covered – Insurers add exclusions • “Commercial general liability policy” is not so general anymore • Exclusions increase every year – “Absolute” pollution exclusion – Fungus exclusion (mold) – Asbestos exclusion – Silica exclusion ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 15
    • Aggressive Coverage Positions • Insurers combine increasing exclusions with aggressive efforts to deny coverage • Example: “Absolute” pollution exclusion – Purpose was to avoid liability for environmental risks – Use has expanded far beyond this:  Death resulting from carbon monoxide from faulty furnace  Curry odor from Indian restaurant  Can result in the “never pay policy” ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 16
    • The Era of “A la Carte” Coverage • Insurers are forcing insureds to buy specific extra coverage or to pay extra to avoid exclusions • Examples – Professional liability coverage – Environmental coverage – Cyber-liability risks – Sexual misconduct coverage ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 17
    • The Critical Importance of an Expert Agent • Insurance is bought through agents and brokers • Agents are not equal • Agents should: – Develop a comprehensive understanding of your business and risks – Be able to advise regarding coverage trends and risks – Be expected to review all coverage, including major exclusions ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 18
    • Common Sense = Buried Treasure • Obtain copies of all policies – Not just the “declarations” pages • Keep copies of all policies • Find copies of old policies – Ask agent or broker – Ask insurance company ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 19
    • Common Sense = Buried Treasure • Assume any claim may be covered • Provide prompt notice – Insurers often deny coverage based on late notice – Particularly critical for claims made policies – Do not assume it’s just a technicality! ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 20
    • Common Sense = Buried Treasure • Special considerations apply to claims made policies – Claims must often be “reported” during the policy period – In order to have continuous coverage, coverage must be renewed every year – Or purchase an “extended reporting period” – Very important if you are exiting a business ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 21
    • Common Sense = Buried Treasure • Never accept your insurer’s determination (or even your agent’s) that a claim is not covered • When to involve coverage counsel: – If there is a “bet the company” claim – If you receive a “reservation of rights” or “denial” letter – If you need a comprehensive review of your insurance program ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 22
    • What Do Coverage Lawyers Do? • Evaluate coverage programs – Including regarding mergers and acquisitions • Evaluate coverage for particular claims • Monitor and serve as independent counsel in claims being defended by insurers • Negotiate with insurers • If necessary, file or defend coverage and bad faith litigation ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 23
    • Conclusion • Goal: Increasing your awareness of possible insurance resources • Questions? ATLANTA CHICAGO DELAWARE INDIANA LOS ANGELES MICHIGAN MINNEAPOLIS OHIO WASHINGTON, DC© 2012 CONFIDENTIAL Barnes & Thornburg LLP. All Rights Reserved. This page, and all information on it, is confidential, proprietary and the property of Barnes & Thornburg LLP, which may not be disseminated or disclosed to anyone other than an employee or partner ofBarnes & Thornburg LLP who is authorized to receive it. This page and all information on it may not be reproduced, in any form, by anyone without the express written consent of the author or presenter. 24