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  • Implications of PPP Certifications for D&O Coverage

    Check your D&O Policy carefully before signing.

    The Paycheck Protection Program (PPP), a key feature of the Coronavirus Aid, Relief and Economic Security Act (CARES Act), was enacted to provide forgivable loans to certain small business and self-employed individuals demonstrating urgent financial need in the wake of the COVID-19 pandemic. (See H.R. 748 § 1102.) Loan recipients must certify their compliance with the terms and conditions of the loan, and violations expose them to a wide array of potential civil and criminal penalties, forfeiture, and other liabilities. If you or your company have already obtained, or are considering applying for a PPP loan, it is highly advisable for you to carefully review your D&O Liability Insurance Policy, as coverages for defense or ultimate liability vary significantly.

  • COVID-19: Plaintiffs Hope to Consolidate Restaurant Suits Over Coverage
    05/05/2020 | Daily Journal

    Insurers have consistently rejected claims filed by restaurants seeking business interruption coverage.

    A breach of contract complaint was filed in San Francisco County Superior Court for two restaurants that were denied coverage by insurers claiming a “virus exclusion” — one of many lawsuits filed by restaurants against their insurers in state and federal court that are adopting different arguments depending on the language of the insurance policies.

  • As Insurers Continue to Deny COVID-19 Claims, Businesses Fight Back
    04/29/2020 | San Francisco Chronicle

    Most insurance companies are telling owners that business interruption policies do not cover shutdowns due to coronavirus. Some businesses have pushed back, filing lawsuits to bring the issue before the courts, the Chronicle reports.

  • Pillsbury Gears Up for Coronavirus Insurance Fights
    04/14/2020 | Bloomberg Law

    Bloomberg Law reports that law firms such as Pillsbury are poised to benefit the most from an expected wave of insurance coverage lawsuits triggered by the coronavirus pandemic.

  • Many Commercial Property Insurance Policies Provide Coverage for COVID-19 Exposures

    The insurance industry’s generic arguments that there is no coverage for the COVID-19 pandemic should not be accepted at face value, as coverage may be available depending on specific policy terms and individualized facts.

    The insurance industry responded to the emergency of the COVID-19 pandemic with preemptive press statements that property insurance policies would provide no coverage—even before policyholders submitted any claims. Given this preliminary knee-jerk reaction, it is unsurprising that the first claims are being denied quickly, and without so much as a pretense of an investigation. In fact, the situation does not lend itself to generic denials. Commercial property policies vary in their terms, definitions and structure, and often include specialized or “manuscripted” provisions. The underlying situation is also unusually fluid. Policyholders should examine their policies carefully in light of their circumstances, and should insist on coverage where appropriate.

  • Insurers May Double Down On COVID-19 Claims Denials
    04/13/2020 | The San Francisco Chronicle

    Some small businesses are grappling with the harsh reality that they may be ineligible for business interruption insurance despite a near-total shutdown during the coronavirus pandemic, The San Francisco Chronicle reported.

  • Don’t Overlook the Next COVID-19 Insurance Battleground: Liability Coverage

    We have written much about business interruption coverage for losses arising from the COVID-19 pandemic, and expect that those losses will continue to dominate the insurance landscape for the foreseeable future.

    But, in recent weeks, another trend has emerged that will also significantly impact businesses: third-party lawsuits related to COVID-19 alleging causes of action ranging widely from negligence to wrongful death to false advertising to breach of contract to securities violations. In much the same way that businesses should evaluate coverage for lost profits, so, too, should those that face claims and lawsuits be prepared to seek insurance coverage for their defense and indemnity costs.

  • Richard Giller Quoted on Fox News Regarding COVID-19 Insurance Claims
    04/07/2020 | Fox News

    According to Fox News, many company policy holders are claiming that insurance companies are declining to pay for service disruptions due to the COVID-19 pandemic.

    Richard Giller, Pillsbury Insurance Recovery & Advisory partner, was quoted on the topic.

  • Pillsbury Industry Insights: Hotels & Hospitality

    Our Industry Insights webinar series is designed to help clients spot issues, mitigate risk and navigate challenges specific to their industry

  • COVID-19: Understanding Business Interruption Insurance and Wide-Impact Catastrophes

    Policyholders can expect insurers to put forth strong objections to many of their claims in an effort to reduce the liability exposure.

    Due to the spread of COVID-19, companies are facing unique challenges to their businesses, including supply chain interruptions, employee and customer safety concerns and government regulations, restrictions and shutdowns. Wide-impact catastrophes like this pandemic will cause tremendous and long-lasting economic damages. And while policyholders have procured insurance to protect themselves from such catastrophic events, business interruption claims are frequently the most difficult and hotly contested of insurance claims. Wide-impact catastrophes often heighten those challenges, given in part to the complexities of measuring business interruption claims. One common dispute is whether the measurement of business interruption should account for the post-loss economic conditions of the impacted area.

  • The Insurance Industry Should Have Been Better Prepared to Deal with COVID-19 Losses

    Over the past several weeks, news reports and their accompanying headlines have signaled what could be a pitched battle between policyholders and insurance companies over coverage for COVID-19 losses. One article noted that “insurance companies are facing political pressure to pay what could be a crippling sum of coronavirus-related claims—even though many of them say their policies don’t cover pandemics.” The headline of that article declared: “Insurers scramble to avoid 9/11-style coronavirus backlash.” Another piece described how the insurance industry had flatly rejected pressure from federal lawmakers “to pay out on business interruption claims from small businesses shut down due to the coronavirus pandemic.” Insurance companies are asking their governments to provide subsidies to cover the losses. Against this backdrop, it is little wonder that lawmakers in Ohio, Massachusetts, and New Jersey have proposed legislation that would retroactively expand business interruption policies to cover losses due to the coronavirus outbreak.

  • Are Denials of Coverage and Belated Defense Payments a Breach of the Duty to Defend? In Wisconsin—Not Necessarily.

    When an insurer pursues a judicial determination on its duty to defend and agrees to defend its insured retroactively only five months after its insured initially requested a defense, has it breached its duty to defend? In most jurisdictions, the answer would be “yes.” In California, for example, an insurer must afford an immediate and entire defense in response to a tendered claim that is potentially covered under the Buss doctrine; belated, after-the-fact payments cannot cure that breach. But under the rule of a new Wisconsin decision, however, the same insurer would not have breached its duty to defend.

  • COVID-19: Business Interruption & Insurance Coverage

    Insurance Recovery & Advisory partner David Klein discusses the business interruption risks being felt by companies around the world and how to approach insurance coverage needs to mitigate those risks.

  • COVID-19 (Coronavirus) Business Implications & Legal Triage Presentation

    Pillsbury’s COVID-19 (Coronavirus) response team presents an up-to-the-minute discussion of the most pressing business and legal considerations in the wake of the global outbreak.

  • Sports360 Podcast Features Richard Giller On Cancellation Insurance in Wake of COVID-19

    Pillsbury Insurance Recovery & Advisory partner Richard Giller was interviewed by former Associate General Counsel for the Major League Baseball Players Association, Jeff Fannell, about event cancellation insurance in the wake of the COVID-19 outbreak. Giller discusses the basics of event cancellation insurance and what affected entities should do now to effectively assess and file coverage claims.

  • Insuring Against the Business Risks of Coronavirus

    Now is the time to take inventory of risks to your operations, supply chain, liability profile and personnel, and ensure you understand the coverage available to meet those exposures, before an outbreak impacts your business.

    The coronavirus pandemic is savaging the global economy, resulting in widespread business closures, near-universal event cancellations, remote officing, the cancellation of orders and slowing of deliveries, and a general disruption of supply chains. News reports indicate that the impacts are already being felt in virtually all industries. Travel, transportation, hospitality, education, health care, entertainment, and event planning are especially hard-hit, but most manufacturing and service activities are being disrupted. In recent years, the insurance industry has cut back on coverage available for pandemic diseases, introducing new or broadened exclusions and applying strict sublimits to contain insurer exposure. Nonetheless, pockets of coverage continue to exist. It is important to make an assessment now of your own business’s vulnerabilities and of the insurance you may have to address future losses.

  • David Klein Reviews Upcoming Coronavirus Insurance Battlegrounds
    03/13/2020 | Law360

    Property and liability insurers are bracing for an uptick in claims across virtually every line of coverage due to the outbreak of the novel coronavirus, as companies lose money by shutting down large-scale events and businesses face supply chain troubles, according to an article by Law360 on the types of coverage ripe for disputes.

  • Peter Gillon Discusses Coronavirus D&O Liability Risks
    03/12/2020 | Business Insurance

    Business Insurance reported that businesses should brace themselves for a likely flood of shareholder suits related to the new coronavirus outbreak. Although the success of any litigation may depend on companies’ willingness to fully disclose directors and officers’ liability-related risks now, experts said.

  • The Coronavirus and Event Cancellation Insurance Coverage

    Event cancellation insurance policies might well cover the significant financial losses that will result if an entertainment or sporting event is cancelled due to the coronavirus.

    On March 4, 2020, Los Angeles Dodgers President Stan Kasten acknowledged that, under certain circumstances, the Dodgers could “wind up either canceling games or holding games without spectators” because of the coronavirus. This announcement came on the heels of the National Basketball Association’s recommendations to its players that they should utilize fist-bumps over high-fives with fans and cautioning players not to take items to autograph from fans such as balls, jerseys and pens. Despite these precautions, two NBA players have tested positive for the virus and the league has suspended the remainder of the season, effective March 11, 2020, until further notice. Similar suggestions have already been implemented by the English Premier League, which has banned all handshakes before its soccer matches. The National College Players Association has also suggested to the NCAA that it should seriously consider holding March Madness games in empty arenas.

  • Coronavirus Update – Are You Covered?

    In January, we were among the first to post on the insurance implications of coronavirus. Since then, the epidemic has landed on our shores, dragged down the stock market, and become a political football. It has affected supply chains originating in China, with significant results for companies like Apple. And it threatens business continuity in the U.S. It is important to remember that the threat to the economic cycle does not originate from financial forces like a tightening of credit, but in nuts-and-bolts workings of the manufacturing and service economy, where both bottlenecks in supply and a pullback in demand threaten markets. Some of these losses are insurable. This post reviews recent coverage developments and notes practical coverage considerations that companies might overlook.

  • COVID-19 Insurance Checklist

    1. Make an inventory of risk pathways that could affect your business.
    • Identify essential supply chains, raw materials or parts providers and service providers to assess impact of potential disruptions.
    • Identify potential sources of liability if your business were impacted by COVID-19.
    • Identify other constituencies that might be affected by disruption to your business and risks associated with such disruption.

  • Do Putative Class Members’ Claims Trigger the Duty to Defend?

    Must an insurer consider the possibility that putative class members (i.e., potential class members not named in the complaint) other than the proposed class representatives (i.e., the plaintiffs named in the complaint to represent the proposed class) have claims within the proscribed policy period in determining whether its duty to defend has been triggered? Many insurers answer “no,” arguing putative class members’ claims—many of which would otherwise be barred by the applicable statute of limitations—are too speculative to trigger coverage. But courts across the country have disagreed, repeatedly answering the question in the affirmative. Last year, the Northern District of Indiana was the latest court to decide this issue in favor of policyholders.

  • Cyber Coverage by any Other Name Can Smell as Sweet: Maryland Court Rules Traditional Property Policy Covers Loss of Data and Impaired Computer Equipment After Ransomware Attack.

    Cyberattacks are an increasingly frequent and costly risk faced by almost every business today. While the availability and scope of cyber-specific insurance has developed exponentially over the past few years, it is important to remember that more traditional policies (such as general liability and first-party property insurance) can still be a source for coverage in connection with cyber incidents, as a recent court decision demonstrates.

  • A Practical Guide to Securing IP Insurance

    There has been tremendous recent growth in the range of specialized insurance policies offered to protect against intellectual property (IP) claims. “Traditional” policies may cover a given IP claim, but specific IP policies are growing in popularity as policyholders with IP-related risks look to bolster that aspect of their coverage portfolio. Because specialized IP policies are less common, less standardized, and less tested in courts, it is important that policyholders be knowledgeable about the market for IP coverage, including the types of coverages and specific policy wordings being offered. Here are a few practical tips to consider when securing such policies.

  • Getting Ahead of the Coronavirus Epidemic: What It Means for Insuring Your Business

    There has been a drumbeat of news reports about Wuhan, China, a city more populous than any in the United States, which is in effective lock-down because of the coronavirus. Foreign nationals are being evacuated, travel has been restricted, and business is at a standstill. At a time like this, preserving public health is the highest priority. But businesses, both local and global, are also affected by shut-down orders, disruptions to their supply chains, mass sick days, and loss of business. Many, especially providers of hospitality or health care, may face elevated liability risks for exposing others to a contagion. It is important to remember that insurance may be available to meet these risks.

  • International Pressure Raises Cybersecurity Threats

    Recent headlines have raised significant concerns about the possibility of cyberattacks on U.S. businesses as a result of the heightened tensions with Iran. The Department of Homeland Security, through its Cybersecurity and Infrastructure Security Agency (CISA), has published alerts and guidance recommending heightened awareness and vigilance. Industry-specific warnings have been issued to regulated entities by other agencies; for instance, advisories concerning threats to the financial system and banks have recently been sent by the Federal Reserve and the New York State Department of Financial Services (NYDFS).

  • What Should a Policyholder Do to Transfer Risk of Loss for Sexual Abuse Claims?

    Sexual abuse litigation is increasingly common, and an unfortunate wave of new lawsuits is coming. In her recent alert, Pillsbury’s Joan Cotkin reviews how the insurance industry has responded to these risks with new liability insurance products designed to address such claims, what coverage defenses insurers are likely to assert, and how you can anticipate and respond to them to secure the benefit of your coverage.

  • How Far Does Your Sexual Abuse Liability Coverage Extend?

    If faced with continuous injury claims based on past acts of sexual abuse, will an insured’s general liability policies with sexual abuse coverage defend?

    In recent years, there has been an unfortunate trend of new lawsuits claiming alleged sexual abuse, filed against various institutions or organizations—some religious, some secular—all across the country. A number of states have passed laws relaxing statutes of limitations, so that alleged victims of sexual abuse can bring such claims even if they relate to events which happened decades earlier, when the claimants were vulnerable children. How has the insurance industry responded to these liability claims?

  • A Recent “Event” in Wisconsin: Appellate Court Rules That a Commonly Used London Market “Occurrence” Definition Is Ambiguous

    In recent years, Wisconsin generally has been a pro-policyholder jurisdiction when it comes to long-tail environmental coverage cases. That trend continues with a decision by a Wisconsin appellate court in a case involving coverage for environmental cleanup costs at a former manufactured gas plant site. In Superior Water, Light & Power Co. v. Certain Underwriters at Lloyd’s, London Subscribing to Policy Nos. K22700, CX2900, and CX2901, the court reversed a lower court and held that there may be coverage under historic policies if there was damage to groundwater during the policy period, notwithstanding that site operations had ceased years earlier. This is an important decision, as the same historic London Market “occurrence” definition was used in many policies issued to other policyholders by London Market Insurers during the same time frame.

  • California Bad Faith Claims Cannot Be “Slapped”

    The California Court of Appeal recently disposed of a novel attack on bad faith law launched by Zurich American Insurance Company. In Miller Marital Deduction Trust, et al. v. Zurich American Insurance Company, 2019 DJDAR (October 23, 2019), Zurich was called upon to defend a cross complaint arising in connection with long-tail pollution claims. Despite an extensive reservation of rights and a conflict of interest, Zurich refused to pay for independent counsel (Cumis counsel, in California parlance) and instead appointed panel counsel to defend. While the underlying environmental case was pending in federal court, the Millers filed a state court action against Zurich asserting that the insurer’s appointment of counsel answerable to the insurance company, in violation of the Millers’ right to independent counsel, constituted breach of contract and a breach of the covenant of good faith and fair dealing.

  • How the “Name-and-Shame Game” Highlights the Need of Electric Utilities for Appropriate Cyber Insurance

    In late August, the Federal Energy Regulatory Commission (FERC) and North American Electric Reliability Corporation (NERC) issued a joint white paper proposing a “name-and-shame” approach to electric utilities that failing to meet NERC Critical Infrastructure Protection (CIP) Reliability Standards. The standards represent a baseline for protecting against cyber-attacks on critical infrastructures. FERC and NERC propose to depart from the historical practice of withholding most material details regarding CIP Reliability Standard violations, and instead to start disclosing the names of allegedly violating electric utilities in response to Freedom of Information Act requests—“naming and shaming them.” This development underscores the substantial cyber risks utilities face and, likewise, the importance of appropriate insurance for those risks.

  • Contractual Liability Exclusion Excised from E&O Policy for Professional Services Company

    In an important decision in the world of professional liability (including D&O and E&O policies), the Seventh Circuit recently held that a “contractual liability” exclusion—i.e., an exclusion for claims “based upon or arising out of … breach of contract”—when inserted in a professional liability policy, that is, a policy intended to insure professionals for services they perform under contract, renders the coverage “illusory.” Accordingly, the appeals court held that the policy must be “reformed” to meet the policyholder’s “reasonable expectations” that coverage would be afforded for claims by clients for errors and omissions in the performance of professional services under contract, and remanded the case to the district court to apply those reasonable expectations in the pending dispute. (See Crum & Forster Specialty Insur. Co. v. DVO, Inc., No. 18-2571 (7th Cir., Sept. 23, 2019), opinion here.)

  • Artificial Intelligence: A Boon for Insurance Underwriting?

    The digitization of business is in high gear. Although some sectors have embraced this change, others, including the insurance industry, have been slower to implement advances. While we’ve previously addressed insurance coverage for artificial intelligence (AI) risks, the risk-averse culture of the insurance industry has been particularly resistant to change in its own business.

  • Oddball Exclusions Are Not All Fun and Games – What the Court Got Wrong in Princeton Excess & Surplus Lines Insurance Co. v. Hub City Enterprises Inc.

    Hub City Enterprises Inc. and Wall St. Enterprises of Orlando Inc. ran an event called “Rum Fest 2017” in Orlando, Fla. Sounds like fun, doesn’t it? But one of the partygoers, who apparently paid to attend the festival, was not amused. In the middle of the party, Robert Hunt saw an oversized beach ball barreling towards his head. When he reached out to deflect the projectile, he ended up suffering injuries to the ligaments in his arms. Mr. Hunt sued Hub City and Wall St. Enterprises, who tendered the claim to Princeton Excess and Surplus Lines Insurance Co., their liability carrier, for a defense. Princeton initially assumed defense of the claim, but it soon repaired to federal court seeking a declaration that it had no duty to defend the suit. In Princeton Excess & Surplus Lines Ins. Co. v. Hub City Enterprises, Inc., the Southern District of Florida ruled in favor of the insurer.

  • Pillsbury Insurance Insolvency Watch: Northwestern National & Highlands

    Northwestern National, the successor to Bellefonte Insurance Company, was placed into liquidation by a court in Wisconsin in May. Northwestern National was previously put into rehabilitation by the Wisconsin Office of the Commissioner of Insurance in 2007 and exited rehab in 2012. Its policyholder surplus has continued to decline in recent years and does not meet the statutory minimum. A claims bar date has been set for November 2, 2019. More information and Proof of Claim forms can be found at the liquidation website.

  • California Supreme Court Sides with Policyholder in Critical Notice-Prejudice Case

    In November 2018, we noted that the California Supreme Court had agreed to resolve Pitzer College v. Indian Harbor Insurance Company, a case that hinged on the importance and application of California’s notice-prejudice rule. On August 29, 2019, the court issued its decision: a policyholder-friendly ruling that opposes technical forfeitures of insurance coverage. Although further proceedings are needed to determine whether Pitzer will ultimately benefit from this victory, the principles it articulates are of immediate interest to policyholders in California and across the country.

  • Delaware Court Adopts Pillsbury’s Theories on Novel D&O Insurance Issues (Part 2)

    In a prior post, we reported an important ruling of first impression by the Delaware Superior Court that a shareholder appraisal action against Pillsbury’s client Solera Holdings Inc. was a “Securities Claim” under Solera’s directors and officers liability insurance policies. In the same decision, the court ruled on two additional issues that no Delaware court had previously decided and that highlight the importance of understanding the specific terms of your company’s D&O policies.

  • Federal Appeals Court Punishes Policyholder for Giving Too Much Notice

    When a company receives a claim or lawsuit, it is critical to provide timely notice to its insurers. But when the claim is first made, sufficient facts may not yet be known to indicate which policy will respond. Many policies also contain language that purports to shift coverage to earlier insurance policies for claims that “relate back” to earlier events. As a best practice, policyholders and their brokers often provide notice of a claim under all policies that might cover a loss, to ensure that coverage is not defeated by failure to meet any obligation to give notice. This method of first providing notice for claims to multiple insurers, and then working with insurers to determine the correct policy to respond, is a well-established practice for managing insurance claims. Once the proper policy to respond to the claim is established, exclusions in the other policies kick in to avoid double coverage.

  • Delaware Court Adopts Pillsbury Theory that Shareholder Appraisal Actions Are Covered Securities Claims Under D&O Policies

    Pillsbury secured an important victory for its client, Solera Holdings Inc., when Delaware Superior Court Judge Abigail LeGrow held—in a matter of first impression anywhere in the country—that a shareholder appraisal action challenging the price Solera obtained for its shares when it sold itself to private equity firm Vista Equity Partners was a “Securities Claim” within the meaning of Solera’s directors and officers liability insurance policies. Last month’s groundbreaking decision in Solera Holdings, Inc. v. XL Specialty Ins. Co., may be found here.

  • California Puts Teeth into Confidentiality Provisions. Lawyer Gets Bitten.

    Disputed insurance claims often end in confidential settlements, as do many insured liabilities. But does it matter if lawyers sign a settlement agreement approving “as to form and content”? Last month, the California Supreme Court answered that question with a resounding “Yes!” In Monster Energy Company v. Schechter, a unanimous California Supreme Court ruled that a lawyer signing such an agreement may be bound by that agreement’s confidentiality provisions.

  • As Investment in Esports Grows, Insurance Coverage Must Keep Up

    Packed stadiums? Check.

    Players and teams with huge followings? Check.

    Massive social media appeal? Check.

    But here, the events that spectators are so eager to attend aren’t live basketball or football games. Instead, fans are lining up to watch others competitively play video games, more commonly known as esports. In 2018, esports garnered 258 million unique viewers globally, compared to 204 million for the National Football League’s 2016 regular season. In 2019, esports are predicted to draw 299 million viewers and hit $2 billion in revenue, up from $1.5 billion in 2018. The International Olympic Committee is even considering adding esports to the 2024 Olympic Games.

  • Hurricane Barry: Prepare Now to Maximize Insurance Recoveries

    Affected businesses and other organizations should take immediate and proactive steps to maximize insurance recovery.

  • Hurricane Florence: Evaluating Business Interruption Claims Following a Large-Scale Disaster

    Storms like the one that recently caused widespread devastation in the Carolinas leave behind challenging questions about business interruption insurance coverage.

  • Hurricane Florence: Insurance Recovery Tips

    In the wake of Hurricane Florence, a thorough understanding of the coverage available, the facts surrounding the loss, and the applicable law can often be key to maximizing insurance recovery.

    While Hurricane Florence has left the Carolinas, it will be weeks, months or even longer before businesses will fully recover from the massive destruction left in its wake. Hundreds of roads remain closed, power is not yet fully restored, and some rivers are still rising past major flood stage level. Wide-impact catastrophes like Florence cause not only widespread physical damage but also tremendous and long-lasting economic damages.

  • Hurricane Florence: Maximizing Insurance Recoveries

    As Florence threatens the Carolinas and beyond, affected businesses and other organizations should take immediate and proactive steps to maximize insurance recovery.

    Hurricane Florence, threatening to buffet and deluge the southeastern coastline with wind and rain, represents just the latest extreme weather event that businesses must anticipate and from which they must prepare to recover. A key early step in the recovery process for businesses and other organizations is communicating losses to their insurance companies. As you take stock of your losses, plan your response, and examine your insurance policies and recovery options, you are going to face many questions: What insurance covers our losses? Have we identified all the policies that may respond? How do we measure or document our losses, including lost profits? Can we recover for our business interruption before the storm hit or if only our suppliers were impacted? Are there any government funds, such as FEMA assistance, available to aid our recovery?

  • After the Big Chill

    Securing and maximizing insurance coverage for losses caused by winter weather early in 2018

  • Wildfires Rage: Insurance Advice for Recovery After the Smoke Clears

    Some guiding principles, taken from decades of experience representing insurance policyholders in California and around the globe

    • The Wine Country fires, and the uncertainty of their cause, may complicate insurance recovery.
    • As in any insurance claim, your insurance recovery may depend on how you present your claim.
    • Be attuned to the deadlines and your obligations, and engage professionals experienced with your industry and the insurance recovery process.

  • Understanding Business Interruption Insurance and Wide-Impact Catastrophes

    In the wake of Hurricanes Harvey and Irma, policyholders can expect insurers to put forward strong objections to some of the most consequential claims asserted by insureds.


    • In construing policy language on BI claims after wide-impact events, courts typically try to avoid a “windfall” result for either side.
    • Policy language matters and can drive varying results depending on how courts construe policy language.
    • Policyholders ought to pay careful heed to controlling legal precedents regarding BI in wide-impact situations.

  • Hurricanes Harvey and Irma: 8 Key Insurance Coverage Issues Impacting the Availability and Amount of Recovery  

    In the aftermath of two powerful hurricanes the process of assessing the damage and rebuilding begins.  Businesses suffered billions of dollars in losses during hurricanes Harvey and Irma, both in physical property damage and disruption of their business (i.e., lost profits).  That is precisely why businesses purchase property and other commercial insurance – to indemnify them when disaster strikes.  However, it is not uncommon for businesses to be unpleasantly surprised when they present a claim that their insurers are unwilling to stand behind the full insurance coverage they promised.  This is particularly so in the case of a substantial loss, and even more so in the aftermath of a wide-area catastrophe – such as a hurricane or other natural disaster – because such catastrophes have negative repercussions on insurers given the number of impacted policyholders.  

  • Internal Revenue Service Provides Helpful Relief to Hurricane Victims

    IRS publications permit easier access to retirement funds and encourage leave-based charitable donation programs for those affected.


    • IRS Announcement 2017-11 provides relief to Hurricane Harvey victims from certain limitations that would normally apply to hardship distributions and loans from tax-qualified employer retirement plans.
    • IRS Notice 2017-48 encourages leave-based charitable donation programs for Hurricane Harvey victims, under which employees may be permitted to convert accrued paid leave into charitable donations. Existing guidance already permits employers to establish major disaster leave-sharing programs.
    • Similar relief is likely to be extended to others impacted during the 2017 Atlantic hurricane season.

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