Specialty Insurance Blog

Rating Lawyers is OK

The idea of rating lawyers on the quality of their service would seem to make all kind of sense. Products, docs, and other professional services are rated by a variety of web-based services, so why would anyone object to a web site dedicated to rating lawyers? A lawsuit against a lawyer rating site, Avvo.com, has recently been dismissed (see here, and order here). It seems that two attorneys were not enthusiastic about their ratings and sued the site. They lost. The Avvo lawyer comments: This is a huge win for our First Amendment rights to express our opinions as Americans…Keep in mind that this case was initiated by a sanctioned attorney that did not like having his recent misconduct brought... Read more →

Are Intentional Acts Covered by an E&O Policy?

It should be obvious that intentional acts are not covered under a professional liability (E&O) insurance policy, but it is rare that a court rules on this question. The intentional acts exclusion in an E&O policy will normally read something like this: …based upon, arising out of directly or indirectly, or in any way involving intentional wrongdoing, fraud, dishonesty, criminal or malicious acts by the Insured In a recent case summarized by Wiley Rein (see here) a court ruled that intentional acts are not covered. In the case, a real estate appraiser had purchased an appraisers professional liability insurance policy and was facing lawsuits alleging a scheme to appraise property at higher than the true value. The insurer provided a... Read more →

Doing Good

Two recent articles, completely unrelated to insurance, are unusual in that they provide a positive perspective on our world. The first, from Fortune, is an article on the work being done by Melinda Gates and the Gates Foundation (see here). Would Buffett have given the Gates Foundation his fortune if Melinda were not in the picture? That's a great question, he replies. And the answer is, I'm not sure. The second, from The Economist, measures our progress in terms of social conditions in poor countries; poverty alleviation; and the incidence of wars and political violence (see here). Public attitudes generally seem to have become more pessimistic and inward-looking… [But] the world seems to be in rather better shape than most... Read more →

Update: Subprime Impact on Professional Liability

Subprime and related credit market losses will impact both the professional liability (E&O) and the directors & officers (D&O ) insurance lines, and underwriters will respond (and some have already) with all the normal moves following catastrophic losses: tighter underwriting, reduced coverage, and higher pricing. For example, some underwriters of mortgage brokers professional liability insurance have already exited from this line. The real question is whether the underwriting responses will be contained to those entities suffering the losses or will be more widespread, and what the order of magnitude will be. Not everyone agrees on the answer (see our prior post), but it should be clear that the problem is still unfolding. There are indications that the problems are spreading... Read more →

Bermuda Insurance History

Bermuda has a long history as a center for insurance beginning with the early development of offshore financial companies (see our prior post). Today, Bermuda is one of the leading centers, if not the leader, for international insurance and reinsurance. In Risk & Insurance, Roger Crombie provides an entertaining chronology of Bermuda’s evolution in the insurance world (see here). He begins with the suicide of a villain, Ivan Breuger, covers the development of the captive insurance industry starting with Fred Reiss, and ends with Bermuda as the most dynamic insurance market in the world. eSpecialty Insurance is your specialty insurance expert. We have developed a streamlined marketplace to provide multiple proposals from a range of competitive insurers, along with expertise... Read more →

Are Intentional Acts Covered by an E&O Policy?

Importer Liability for Foreign Made Products

Liability for products manufactured in China may not be covered under a products liability insurance policy, and it may not even be possible for an injured party to pursue a claim against the manufacturer. This shifts significant products liability exposure to the importer of foreign made products. There have been numerous reports concerning unsafe products, such as toys, food and drugs, from China. A noted in a recent article in the Boston Herald (see here), it is virtually impossible to pursue a products liability claim against a Chinese manufacturer. Every step in litigation can be an ordeal when the defendant is a Chinese company Chinese companies will assert that U.S. courts have no jurisdiction. It is illegal to take depositions... Read more →

Subprime Impact on Professional Liability

The subprime crisis has caused significant losses in some business sectors, notably financial institutions that have either directly or indirectly invested in subprime mortgages, and these losses are being felt in the professional liability and management liability (D&O) insurance markets. However, a recent survey (110 respondents) concluded that these losses will have little impact on professional and management liability pricing (see here). More than 90 percent of commercial banks, investment banks, mortgage lenders, real estate investment trusts and other companies in the financial services sector have renewed, or expect to renew, their D&O and E&O policies at the same or lower rates. It is early days in the subprime crisis. While we have seen many different types of companies report... Read more →