Insurance Products

Category: Insurance Products

October 10, 2013 • Insurance Products, Legal Malpractice, Professional Liability Matters

Eroding Policy Limits Spur Litigation

Professional liability insurance policies each contain limits of liability that set the upper threshold that the insurer will fund. However, a policy’s stated limit does not necessarily correlate to the amount that will be available to resolve a claim. Instead, many policies provide that the costs of defense are included within the coverage limit—every dollar spent on defense correspondingly erodes the amount available to resolve the claim. These so-called eroding limits, or defense-within-limits policies become particularly important in heavily litigated cases, where high defense costs can approach, and sometimes surpass, the total limit of liability.

October 8, 2013 • Insurance Products, Professional Liability Matters, Settlement

Stop; Hammer (Clause) Time

Litigation is big business with big dollar signs. As a result of the large awards that can result from malpractice suits, many professionals, their attorneys, and insurers are interested in early settlement discussions. When considering settlement, the defense team must balance “right and wrong,” pride, defense costs, and other complicated factors that are difficult to quantify. For the professional, the decision may be more about reputation and morals than budgets. As a result, insureds may not always want to follow their insurer’s inclination to settle. Enter the “hammer clause.”

August 12, 2013 • Insurance Products, Professional Liability Matters

Does Malpractice Insurance Cover Fee Disputes?

You may be surprised to learn that some professional malpractice policies do not cover fee disputes. Professional liability insurance is an essential component of every professional’s practice, helping to mitigate risk in malpractice actions. But many professional liability policies may leave professionals to fend for themselves in one of the most fundamental aspects of the …

June 28, 2013 • Insurance Products, Professional Liability Matters, Risk Management

The Insurance “Conspiracy” Facing A-Rod and the Yankees

Alex Rodriguez is widely considered one of the greatest baseball players of his generation, but much of his career is filled with controversy. The most recent debate concerns A-Rod’s receipt of a hefty salary from the Yankees although he has not played a single game this year. Reportedly, the 12-time All Star is now grumbling that the Yankees are intent on keeping him off of the field so as to trigger insurance dollars. In December 2007, Rodriguez and the Yankees agreed to a 10-year, $275 million contract; at the time, the richest contract in baseball history. Following his underwhelming performance in the 2012 playoffs, and his off-season surgery which may not heal this year, A-Rod is reportedly questioning whether the Yankees are conspiring to keep him on the disabled list so as to trigger an insurance clause to cover his albatross-like contract.

May 22, 2013 • Agents and Brokers, Insurance Products, Professional Liability Matters

Botched Weather Report Leads to Unusual Insurance Claim

A feud is developing between flower enthusiasts and the Philadelphia media arising from an “overly hyped” weather report. The possible remedy may be in the form of a lesser known insurance product. The Philadelphia Flower Show usually generates about $1 million in profits from its annual exhibit. But not this year. Reportedly, the show drew substantially fewer attendees than expected this year and organizers of the event are blaming a “botched” weather report. Now the event’s president is accusing Philadelphia media outlets of “hyping up” a major snowstorm during the week of the flower show that never materialized but led to scores of cancelled visitors. In turn, this led to about $1 million in losses. Is there insurance for this? You bet.

May 6, 2013 • Insurance Products, Professional Liability Matters

Insurance Blunder Costs Newest Philadelphia Eagles’ QB $11.5 Million

Quarterback Matt Barkley was selected by the Philadelphia Eagles with the 98th pick in the 2013 NFL draft. He was the fourth quarterback selected and was the first selection in the fourth round. History suggests that he will sign a four-year contract worth about $2.5 million. Sure, that’s a lot of dough, but not nearly what Barkley would have earned had he foregone his senior season at USC and entered the NFL draft in 2012. As a projected top-10 pick last year, Barkley would have made a minimum of $12 million guaranteed. His only guaranteed pay this year could be a signing bonus in the $500,000 range. Interesting reading, for some, but why does Professional Liability Matters care? Because Barkley could have purchased “draft insurance” last year which could have saved him millions.

May 1, 2013 • Insurance Products, Professional Liability Matters, Risk Management

Lawsuits Targeting America’s Wealthiest

A high percentage of the wealthiest Americans believe that they are more likely to be the subject of a lawsuit today than they were before the financial crisis. The issue of disparity of wealth, income and taxation has intensified these fears that their wealth can attract lawsuits. These concerns are reportedly legitimate, because under the widely accepted doctrine of joint and several liability, if more than one defendant is responsible for a plaintiff’s injury, any of the defendants may be held responsible for the entire damage award. The result is that the plaintiff may focus the attack on the deepest pocket. Much of this analysis may not come as a surprise but people of means frequently underestimate the potential cost of a lawsuit and misunderstand the affordability of effective protection.

April 18, 2013 • Insurance Products, Professional Liability Matters

A Gap in the Professional Liability Insurance Marketplace?

Is “tailor-made” coverage for emerging industries the future of professional liability insurance? “Traditional professional liability” policies, which typically serve lawyers, accountants, architects, brokers and doctors, may no longer provide the precise fit for evolving professionals. “Whether their clients are consultants, nurse’s aides or chicken sexers, many producers have found a gap in the professional liability marketplace,” according to the Insurance Journal. Coverage has not always kept pace with occupational changes, leaving many professionals pushing for an insurance product that addresses the biggest industry-specific exposures. So-called “tailor-made” policies may fill this gap.