What are the most significant types of claims for recovery against insurance companies being triggered by the financial crisis?
Myers : The crisis is obviously spawning very significant claims. Typically, a significant percentage of those claims will be covered by insurance, particularly directors & officers liability (D&O) and errors & omissions (E&O) policies – for third party claims, and Fidelity Bonds and Crime/Dishonesty Policies – for first party claims. Editor: Do you have any specific examples? Myers : Sure. For example, financial institutions, funds and securities firms that placed money with entities such as The Stanford Group or Madoff are seeing claims by the investors or contributors of the money for alleged malfeasance, negligence and other conduct related to the placement of funds with those entities. These types of “third party” claims are typically covered by the D&O and E&O polices carried by such financial institutions. Litigation between financial institutions and investment firms over mortgage backed securities and collateralized debt obligations also frequently trigger D&O, E&O and other c
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