Articles & Updates

The purpose of the recently passed Jumpstart Our Business Startups Act, also known as the JOBS Act, is to make it easier for companies to raise capital—the life blood of high-growth start-ups.  This Act is good news for smaller companies that want to raise capital.  It also inevitably raises personal liability concerns for directors and officers of the companies raising capital.  Properly addressed, however, these concerns do not have to evolve into actual problems for directors and officers.

Download PDF

The SEC offers timely guidance on cybersecurity disclosures – but how difficult is it to take their advice? And just what is this “relevant insurance coverage” they suggest you disclose?

Download PDF

M&A deals have small issues, big issues...and “landmine” issues: issues that can seem small but, if mishandled, can end up being significant. Regardless of whether your company is seeking to merge with another company or is looking to acquire or be acquired, here are several key insurance risk management factors worth considering prior to the drafting of a merger agreement.

Download PDF

Public companies routinely purchase directors and officers (“D&O”) liability insurance, and regard the purchase as part of the cost of being a public company. But does a private company need D&O insurance?

Download PDF

One consequence of the global, interconnected nature of the economic markets is that plenty of non-U.S. companies list their shares on U.S. Exchanges. For most foreign filers, listing in the U.S. is entirely unproblematic. However, there has been some interesting news in the U.S. securities class action lawsuit arena that involves directors of foreign-based companies.

Download PDF

Is the Dodd-Frank Act (“Dodd-Frank”), signed into law on July 21, 2010, potentially a game-changer when it comes to the exposure of officers and directors of public companies to litigation? Yes. And unfortunately for directors and officers and the companies they serve, the scope of insurance coverage afforded by director and officer (“D&O”) liability insurance policies can be problematic.

Download PDF

In many types of Corporate and Executive Protection (“CorpEx”) insurance policies, the insurance carrier controls the defense of a claim—including selection of counsel to defend the insured. These “duty to defend” policies often provide key advantages to an insured. Still, insureds sometimes are surprised when they have little or no control over who their attorney will be. In order to avoid surprises, it is important to understand what type of policy you have, along with the advantages and pitfalls of the policy.

Download PDF

While D&O rates continue to decline for most companies, some of the most interesting recent renewal discussions are about changes in coverage. A new form released by Chartis (AIG) in May 2010 is starting to gain traction in the public company D&O market, and other insurers are responding with endorsements to match many of the enhancements. What are these enhancements, and how meaningful is the coverage? Should failure to get any of these enhancements be considered a deal-breaker?

Download PDF

Insurance remains the best, most effective hedge against a director or officer’s worst-case scenario—the one-two punch of lawsuit that comes on the heels of his or her corporation’s filing for bankruptcy.

If you are sued as a director or officer, you would normally expect your company to advance legal fees to you and indemnify you. Unfortunately, that expectation will be dashed if you are sued while your company is in bankruptcy or if your company goes into bankruptcy while you are being sued. In bankruptcy, you are at best an unsecured creditor standing in line with all the other unsecured creditors hoping the company’s limited assets don’t run out. Your D&O policy may be the only thing left protecting you.

Download PDF

Directors and officers of companies face the possibility that — even if they diligently discharge their duties to their stockholders — their stockholders may still sue them. During the period leading up to an IPO, directors and officers may be particularly concerned about their personal liability because the chance that they will be sued by their stockholders substantially increases once the company’s shares are publicly traded. Recognizing that the risk of personal liability makes being a director or officer of a public company unattractive, most companies purchase director and officer liability insurance, or “D&O Insurance”, to protect their directors and officers. This insurance can in turn help companies recruit and retain good directors and officers.

Download PDF