The ICLC annual meeting in
Tucson included a session on directors’ and officers’ insurance policies on February 28, entitled, “To Renew or Not to Renew? The $64,000,000 Question.” A panel consisting of Mary Craig Calkins of Howrey LLP; Deidre Finn of Navigators Pro, Carla Owens of the Chubb Insurance Company, and executive insurance consultant Kevin Ishizu focused on a hypothetical renewal of a D&O policy. The panel used mock interviews and exercises to illustrate problems confronting a company that enjoyed years of growth, but now faced new challenges involving corporate executive compensation issues and accounting discrepancies. The presentation was accompanied by a paper written by Mary Craig Calkins consisting of “An Underwriting Checklist for Policyholders During a Difficult D&O Renewal.” The paper points out that the current D&O market “is made even more complex by recent stock options dating investigations, governmental and regulatory lawsuits, and actions giving rise to potential new D&O liabilities such as allegations of corporate wrongdoing arising out of the failures [to plan adequately] for global warming or climate change-related liabilities, and issues involving potential liabilities for financial problems arising out of the sub-prime mortgage crises, where corporate management and board members are challenged on business decisions that inevitably lead to diverse liabilities and the need for insurance.” The checklist presented in the paper follows the renewal issues addressed by the panel’s presentation and suggest additional areas for review in the current D&O market. Ms. Calkins’ paper will be presented in a forthcoming issue of Coverage, the official publication of the Insurance Coverage Litigation Committee of the
ABA ’s Section of Litigation.