Insurance Law Commons^™

How Collective Settlements Camouflage The Costs Of Shareholder Lawsuits, Richard Squire

Faculty Scholarship

Corporations insure against liability in shareholder lawsuits by buying tiered coverage from multiple insurers who each cover a distinct segment of the potential damages range. Rather than negotiating to settle individually with the plaintiff, the insurers seek to reach a single, collectively binding settlement agreement. This combination of segmented coverage and collective settlements produces a conflict of interests: the corporation’s managers and some insurers are better off if the case settles pre-trial for the expected damages, while other insurers are better off going to trial. To force reluctant insurers to settle, courts have created a duty that can require an …

Public-Private Approaches To Mass Tort Victim Compensation: Some Thoughts On The Gulf Coast Claims Facility, Myriam E. Gilles

Articles

No abstract provided.

Establishing A New Protection And Indemnity (P&I) Insurance Institution In Turkey, Muhammet Alper Keceli

World Maritime University Dissertations

Insurance draws attention as a sector that is understood much better in terms of its importance especially in recent years globally and in Turkey as well and this sector is developing each day. In direct proportion to the development of insurance, the importance of marine insurance forming a special part of insurance has also come to the surface. Marine insurance, as a field has unique characteristics that can dominant from general insurance principles from certain angles, and stands before us as a dynamic field necessary to be reviewed and handled over and over again with the developments in the world. …

Insurance, Stephen M. Schatz, Stephen L. Cotter, Bradley S. Wolff

Mercer Law Review

What constitutes an "occurrence," as defined by a commercial general liability policy, was again a significant focus of the appellate courts during the survey year. The Georgia Supreme Court finally resolved opposite positions taken by federal courts and state courts in Georgia, deciding that negligent faulty workmanship by a contractor resulting in damage to other property constitutes an occurrence. However, when an insured acts negligently, but with foresight, expectation, or design, such conduct will not be a covered occurrence. The Georgia Court of Appeals also reinforced the correct legal standard to consider when deciding whether an insured is justified in …

State Mandated Disability Insurance As Salve To The Consumer Bankruptcy Imbroglio, Alena Allen

BYU Law Review

From Main Street to Wall Street, Americans are hurting. In 2009, over 1.4 million families filed for bankruptcy. Researchers examining the causes of bankruptcy discovered that as many as sixty-two percent of all bankruptcies were precipitated by a medical crisis. Because many Americans are living paycheck to paycheck and lack disability insurance, when a medical crisis strikes, bank accounts are quickly depleted by the amalgam of high medical bills and lost wages. Disability insurance provides needed wage replacement when a worker is unable to work due to an illness or injury. This Article presents the case for statemandated disability insurance …

The Benefits Of Opt-In Federalism, Brendan S. Maher

Faculty Scholarship

The Affordable Care Act (“ACA”) is a controversial and historic statute that mandates people make insurance bargains. Unacknowledged is an innovative mechanism ACA uses to select the law that governs those bargains: opt-in federalism.

Opt-in federalism – in which individuals choose between federal and state rules – is a promising theoretical means to make and choose law. This Article explains why, and concludes that the appeal of opt-in federalism is independent of ACA. Whatever the statute’s constitutional fate, future policymakers should consider opt-in federalist approaches to answer fundamental but exceedingly difficult questions of health and retirement law.

Catastrophic Oil Spills And The Problem Of Insurance, Kenneth S. Abraham

Vanderbilt Law Review

The BP oil spill of 2010 focused considerable attention on the operating conduct of BP, on the potential liability of BP and other entities associated with the spill, and on the fund that BP established to provide compensation to victims of the spill. Much less attention has been paid, however, to the nature and scope of insurance covering losses caused by catastrophic environmental disasters such as oil spills. BP's establishment of the Gulf Coast Claims Facility, and the compensation that will be paid by that facility, will likely dampen awareness of the mismatches between the resulting losses and the insurance …

Litigating Bp's Contribution Claims In Publicly Subsidized Courts: Should Contracting Parties Pay Their Own Way?, Bruce L. Hay, Christopher Rendall-Jackson, David Rosenberg

Vanderbilt Law Review

In this Article, we focus on an important problem involving mass-accident cases that was highlighted by the Deepwater Horizon litigation: overuse of courts to enforce contribution claims. These claims seek to shift incurred or expected liability and damages between the business and governmental entities that participated in the activity that gave rise to the mass-accident risk. Participants in such ventures generally have the option to determine by contract beforehand whether to subject themselves to contribution claims and, if so, whether such claims will be resolved by a publicly funded court or by a privately funded process, such as arbitration. Because …

Improving The Population’S Health: The Affordable Care Act And The Importance Of Integration, Lorian E. Hardcastle, Katherine L. Record, Peter D. Jacobson, Lawrence O. Gostin

O'Neill Institute Papers

Heath care and public health are typically conceptualized as separate, albeit overlapping, systems. Health care’s goal is the improvement of individual patient outcomes through the provision of medical services. In contrast, public health is devoted to improving health outcomes in the population as a whole through health promotion and disease prevention. Health care services receive the bulk of funding and political support, while public health is chronically starved of resources. In order to reduce morbidity and mortality, policymakers must shift their attention to public health services and to the improved integration of health care and public health. In other words, …

Derivatives: A Twenty-First Century Understanding, Timothy E. Lynch

Faculty Works

Derivatives are commonly defined as some variation of the following: a financial instrument whose value is derived from the performance of a secondary source such as an underlying bond, commodity or index. But this definition is both over-inclusive and under-inclusive. Thus, not surprisingly, derivatives are largely misunderstood, including by many policy makers, regulators and legal analysts. It is important for interested parties such as policy makers to understand derivatives, because the types and uses of derivatives have exploded in the last few decades, and because these financial instruments can provide both social benefits and cause social harms. This Article presents …

Hiring Teams, Firms, And Lawyers: Evidence Of The Evolving Relationship In The Corporate Legal Market, Michele M. Destefano, John C. Coates, Ashish Nanda, David B. Wilkins

Articles

How are relationships between corporate clients and law firms evolving? Drawing on interview and survey data from 166 chief legal officers of S&P 500 companies from 2006-2007, we find that-contrary to standard depictions of corporate client-provider relationships-(1) large companies have relationships with ten to twenty preferred providers; (2) these relationships continue to be enduring, and (3) clients focus not only on law firm platforms and lead partners, but also on teams and departments within preferred providers, allocating work to these subunits at rival firms over time and following "star" lawyers, especially if they move as part of a team. The …

Gambling By Another Name; The Challenge Of Purely Speculative Derivatives, Timothy E. Lynch

Faculty Works

Derivatives contracts can be used to hedge pre-existing risks, but they can also be used to speculate. This Article focuses on derivatives contracts in which both counterparties are speculators. These “purely speculative derivatives (PSD) contracts” have become increasingly common over the last several years and have notably resulted in the transfer of many tens of billions of dollars from institutions that had invested in the US subprime housing market to a handful of speculators who foresaw the market’s collapse, as well as many billions of dollars in fees to PSD brokers.

PSD contracts are problematic. PSD contracts are less-than-zero-sum transactions …

What Is Wrong About Wrongdoing, Anthony J. Sebok

Articles

This short article, which was prepared for a conference on civil recourse theory at Florida State University School of Law, asks whether Blackstone’s rejection of maintenance is inconsistent with the theoretical commitments of modern civil recourse theory. Blackstone strongly believed that third parties should not help victims of wrongdoing discover that they have been wronged, this article asks whether modern civil recourse theory is committed to the position (now in retreat throughout common law nations) that third parties who help strangers’ lawsuits are acting against the public interest (or, as Blackstone put it, are “pests of society . . . …

Terror Cats: Tria’S Failure To Encourage A Private Market For Terrorism Insurance And How Federal Securitization Of Terrorism Risk May Be A Viable Alternative, Andrew Gerrish

Washington and Lee Law Review

No abstract provided.

Credit Ratings In Insurance Regulation: The Missing Piece Of Financial Reform, John Patrick Hunt

Washington and Lee Law Review

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 directed federal financial regulators to remove credit ratings from their rules, but had nothing to say about the use of credit ratings by state insurance regulators. This omission is significant because insurers own nearly twice as many foreign, corporate, and municipal bonds as banks do. During the 2000s, state insurance regulators came to rely increasingly on rating agencies rather than the regulators’ in-house valuation office to assess the credit risks of these holdings. After the perceived widespread failure of ratings in the crisis, the insurance regulators did undertake a …

Independent Counsel In Insurance, Douglas R. Richmond

San Diego Law Review

Mention the term "independent counsel" to many lawyers and they think immediately of the process whereby the Attorney General of the United States requests a panel of federal judges to appoint an Independent Counsel to investigate and prosecute crimes by government officials. Business lawyers may think of "independent counsel" in the context of counsel for independent directors on a corporate board in connection with select matters. For most litigators, however, the term "independent counsel" describes a lawyer engaged to defend an insured at a liability insurer's expense in a case in which the liability insurer has lost the right to …

Summary Of Benchmark Ins. Co. V. Sparks, 127 Nev. Adv. Op. No. 33, Christian Balducci

Nevada Supreme Court Summaries

An appeal from a District Court’s denial of summary judgment.

Stoli And Intent: The Feeling's Mutual, But It's Starting Not To Matter Anyway, Franklin G. Monsour Jr.

Cardozo Journal of International and Comparative Law

The article examines the legal debate surrounding Stranger-Originated Life Insurance (STOLI), advocating for the adoption of the mutual intent standard over the unilateral intent standard to determine the legality of such policies. It argues that the mutual intent standard, supported by historical cases and recent legislation, provides a more robust framework to prevent sham transactions and uphold the insurable interest rule.

Stolen Art, Looted Antiquities, And The Insurable Interest Requirement, Robert L. Tucker

Akron Law Faculty Publications

Trafficking in stolen art and looted antiquities is a multi-billion dollar enterprise. Stolen art and looted antiquities are ultimately sold to museums or private collectors. Sometimes the purchasers acquire them in good faith. But other times, the purchasers know, suspect, or willfully blind themselves to the possibility that the piece was stolen or illegally excavated and exported up the chain of title.

This problem is compounded by customs and course of dealing in the art and antiquities trade. Dealers generally decline to provide meaningful information to prospective purchasers about the provenance of a piece, and sophisticated purchasers customarily acquiesce in …

Disability Rights, Welfare Law, Mark C. Weber

Cardozo Law Review

This Article asks how disability rights ideas can be reconciled with - and might transform - the law of public assistance. The social model of disability forms the basis of most disability rights thinking. This model recognizes that impairments do not by themselves disable, but disability instead arises from a dynamic between a person's physical and mental conditions and society's environmental and attitudinal barriers: Paraplegia does not cause disability but for stairs, curbs, and human attitudes that limit accessibility. The social model focuses on changing the environment; its close corollary, the civil rights approach to disability, looks to anti-discrimination law …

The First Liability Insurance Cartel In America, 1896-1906, Sachin S. Pandya

Faculty Articles and Papers

This article studies the rise and fall of the first liability insurance cartel in the United States. In 1886, insurance companies in America began selling liability insurance for personal injury accidents, primarily to cover business tort liability for employee accidents at work and non-employee injuries occasioned by their business operations. In 1896, the leading liability insurers agreed to fix premium rates and share information on policyholder losses. In 1906, this cartel fell apart. Although largely forgotten until now, the rise and fall of this cartel confirms the expectations of both cartel theory and past studies of insurance cartels, largely in …

Summary Of Powell V. Liberty Mutual Fire Insurance Co., 127 Nev. Adv. Op. No. 14, Michael Li

Nevada Supreme Court Summaries

An appeal from a grant of partial summary judgment in a breach-of-contract action arising from a denial of a homeowner’s insurance claim under the policy’s “earth movement exclusion” clause.

Adjudicating Insurance Policy Disputes: A Critique Of Professor Randall's Poposal To Abandon Contract Law, Jared A. Wilkerson

W&M Law Student Publications

No abstract provided.

Are Risk Preferences Stable Across Contexts? Evidence From Insurance Data, Levon Barseghyan, Jeffrey Prince, Joshua C. Teitelbaum

Georgetown Law Faculty Publications and Other Works

Using a unique data set, the authors test whether households' deductible choices in auto and home insurance reflect stable risk preferences. Their test relies on a structural model that assumes households are objective expected utility maximizers and claims are generated by household-coverage specific Poisson processes. They find that the hypothesis of stable risk preferences is rejected by the data. Their analysis suggests that many households exhibit greater risk aversion in their home deductible choices than their auto deductible choices. They find that their results are robust to several alternative modeling assumptions.

The Individual Mandate, Sovereignty, And The Ends Of Good Government: A Reply To Professor Randy Barnett, Patrick Mckinley Brennan

Working Paper Series

Randy Barnett has recently argued that the individual mandate is unconstitutional because it is an improper regulation under the Necessary and Proper Clause (in conjunction with the Commerce Clause) because it improperly "commandeers" the people and thereby violates their sovereignty. In this paper, I counter that the argument from sovereignty is unavailing because it is, among other defects, hopelessly ambiguous. The variety of historically attested meanings of "sovereignty" renders the concept useless for purposes of answering questions of comparative authority, including the authority of the Congress to mandate that individuals purchase health insurance from a private market. There is no …

Cargill V. Ace American Ins. Co.: The Minnesota Supreme Court Reminds Us Of The Value Of Every 2-Year-Old's Favorite Question, Chad Snyder

Journal of Law and Practice

No abstract provided.

It’S An Art Not A Science: State-Mandated Insurance Coverage Of Assisted Reproductive Technologies And Legal Implications For Gay And Unmarried Persons, Valarie K. Blake

Scholarly Works

Assisted reproductive technology (ART) has made it possible for a wealth of individuals, who would otherwise be unable, to create families and become parents. Traditionally, most people think of infertile couples as the beneficiaries of such technology, but ART has special and important implications for gay and/or unmarried persons as well. Dubbed the “structurally infertile,” this latter group is highly dependent on ART for their family planning needs. Despite the growth in popularity of ART for both the medically and structurally infertile, ART continues to be a mainly private-payer enterprise, reserved for those individuals who have the expendable income to …

Four Constitutional Limits That The Minimum Coverage Provision Respects, Neil S. Siegel

Faculty Scholarship

Opponents of the minimum coverage provision in the Affordable Care Act charge that if Congress can require most people to obtain health insurance or pay a certain amount of money, then Congress can impose whatever mandates it wishes—or, at least, whatever purchase mandates it wishes. This Essay refutes that claim by identifying four limits on the Commerce Clause that the minimum coverage provision honors. Congress may not use its commerce power: (1) to regulate noneconomic subject matter; (2) to impose a regulation that violates constitutional rights, including the right to bodily integrity; (3) to regulate at all, including by imposing …

Regulation Not Prohibition: The Comparative Case Against The Insurable Interest Doctrine, Sharo Michael Atmeh

Northwestern Journal of International Law & Business

American law requires an insurable interest—a pecuniary or affective stake in the subject of an insurance policy—as a predicate to properly obtaining insurance. In theory, the rule prevents both wagering on individual lives and moral hazard. In practice, the doctrine is avoided by complex insurance transaction structuring to effectuate both origination and transfers of insurance by individuals without an insurable interest. This paper argues that it is time to abandon the insurable interest doctrine. As both the English and Australian experiences indicate, elimination of the insurable interest doctrine will have little detrimental pecuniary effect on the insurance industry, while freeing …

The Future Of Climate Change Litigation After Aep V. Connecticut, Amanda Leiter, Rick Faulk, Eric Lasker, Mike Myers

Scholarly Articles in Law Reviews & Journals

No abstract provided.