What’s your brand? Whether you have developed one professionally, or simply let it happen, experts agree that you definitely have one. Whether you call it “image” or “reputation,” it’s there. And a brand goes far beyond advertising and mar- keting: At its core, your brand makes an emotional connection in your client‘s or prospect’s mind. So the ques- tion is not whether you have a brand, but whether your current brand is enhancing or detracting from your profes- sional success. According to branding experts, one of the key considerations (posi- tive or negative) that consumers make with a brand is whether you’re consistent and realis- tic. In other words, do you deliver what you promise? A key strength of a great brand is the sense of predictability that it creates in the consumer’s mind. Think Lexus, Disney, or IBM — each has strived to create positive expectations around their brand that enhance their ability to attract and retain clients. For a professional, a crucial attribute is trust: a principle founded on an ethical approach to every relation- ship and transaction. But as recent meltdowns in the busi- ness world have confirmed, once the sense of trust is lost, your brand is tarnished. Is your brand trusted? Ask your clients, current and potential, what your brand says to them. And likewise, we’d like to ask what our brand means to you. We want nothing less than to be your trusted insurance advisor. T he D&O marketplace is making increasing use of coinsurance clauses. Does this trend make sense for you? The clauses usually make the insured a participant in the claim amounts once the retention is met. For example, on a policy with $50 million in coverage, a 20% coinsurance limit and a $1 million retention, coinsurance would make the insured responsible for 20% of the settlement (and possibly defense) costs in excess of the $1 mil- lion retention. What might you gain by agreeing to such a clause? A few possibilities include better pricing, more generous underwriting and higher coverage amounts. Insurers take a favorable view of policyholders who are willing to take an extra stake in losses. These policy- holders tend to be more focused on risk management and loss prevention, as well as more cooperative with the insurer when losses arise. Consider coinsurance as one more possible tool in your insurance arsenal. We’ll be happy to answer any questions on this or any other possibilities for customizing your current coverages to meet your needs and preferences more effectively. Coinsurance and Your D&O Is Your Brand a Trusted Brand?
Successful and growing companies exist in a steadily shrinking world mar- ketplace. Ease of air travel, the global expansion of the Internet and other elec- tronic communications have made it both possible and desirable for a busi- ness of any size to develop an interna- tional presence. However, there are dark realities of operating overseas: Employees of a wealthy American com- pany make an attractive target for those looking to make a quick profit from kid- nap, ransom or extortion. If you have, or will have, an exposure to such crimes, you need to consider both preventative and reactive meas- ures. Although we can’t teach your employees self-defense, we can advise you on possible insurance protection. One of the prime policies is kidnap and ransom (K&R) insurance, designed to cover the loss of money, securities or other types of property demanded for the return of the employee. While K&R coverage usually requires an actual (or alleged) kidnapping, some forms also cover extortion, which is loss resulting from the threat to harm a person or busi- ness unless certain demands are met. Of course, you don’t have to go over- seas to face the risks of kidnap, ransom, and extortion. You only have to be suc- cessful enough for someone to think that you have the resources to pay up if one of your employees, directors, officers, partners, or members is taken against their will. Add K&R coverage to your self-defense arsenal — just in case. We’d be happy to advise you on the types of coverage and underwriting guidelines involved. Your general liability policy proba- bly excludes “professional services,” while your professional liability insur- ance includes it. But what does the term mean? And suppose the two policies disagree on the definition? Although many courts have weighed in on this question, studies indicate that their decisions are so contradictory, as well as almost totally based on the specific facts, that there’s no basic agreement or consensus. For your specific situation, you need to know the provisions and intent of your general liability and professional liability policies. For example, if you’re a lawyer, claims arising from your law services are intended to be excluded by your gen- eral liability and covered by your pro- fessional liability. But what if you also serve as a property manager — is that considered a “professional service” for an attorney? Probably not, since you don’t need a law degree or legal professional education to fill this role. Yet, does the fact that you’re an attorney bring all of your business actions under the term “professional services?” You need to clarify this situation with your liability carriers before making any coverage assumptions. Our professional liability repre- sentatives can work with you to determine your exposures and where the proper coverages reside for each. ‘Professional Services’ Defined F or decades, creators of intellec- tual property had the copyright laws behind them in protecting their efforts. Most people are familiar with the easily recognized copyright symbol, indicating the author doesn’t wish the material copied, reprinted or quoted exten- sively without prior permission. In the age of mechanical printing, this was often sufficient: It took a fair amount of effort to transpose existing materials, and the possi- bility that one could do this with- out noticing the copyright symbol was considered unlikely. In fact, the right of an author to copy- right protection has become so accepted that recent changes in the law make the protections available even without the previ- ously required visible attachment of a copyright symbol to the mate- rials or filing of the materials with a governmental organization. Enter the computer age. The amount of material now available in electronic format and the ability to simply “cut and paste,” even from one Web site to another, has virtually eliminated the time and mechanical barriers to copying such materials. And what’s easy often gets done. Do you have procedures to pro- tect against copyright violations, including unauthorized infringe- ment on the slogans or trade- marks of others? If such inadver- tent infringement occurs, will your current insurance provide protec- tion? As the abilities of the digital age evolve, work with us to be certain that your liability protec- tion evolves as well. Copyright Law in the Computer Age Kidnap and Ransom Coverage
COPYRIGHT ©2004 This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is under- stood that the publishers are not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert advice is required, the services of a competent professional should be sought. A lthough we often think that each insurance policy is designed for a particular coverage area (auto insurance for autos, pro- fessional liability for professional acts, general liability for non-profes- sional exposures, etc.), certain situa- tions might lead to multiple liability policies covering a single claim. For example, what if a client were injured while visiting your office for an appointment? Is the injury filed as a professional claim (covered by your professional liabil- ity policy), since it was a profession- al services appointment? Or is it a premises claim (your general liabili- ty policy), because they were injured while in your office? The answer: It could be both. The defense provided by your policies will hinge on the specific facts of the allegation filed against you by the injured party. There are few, if any, legal prohibitions against rais- ing multiple issues in a single com- plaint. In fact, it’s to the injured party’s benefit to do so, since your insurance carriers still must defend against the entire complaint even if many of the allegations, if proven, would not fall under that coverage. Trying to partially defend a claim will probably be impossible and you could even risk a claim by way of inadequate defense. So the injured party has created a scenario in which the odds are that at least one of your insurance carriers is going to pay something for some part of this claim — even if most of the allegations are dis- missed during the hearings. It only takes one successful allegation to secure a payment under your liability coverage. A key issue in preparing for such possibilities is proper coordination of coverage provisions among your policies. Multiple allegations, while attempting to draw to the table as much coverage as possible, might also uncover unintended coverage gaps. Call us for a com- plete review of all your coverages — whether written by our agency or not — to look for possible gaps and to arrange the best possible coordination among your coverage providers. One of the popular catch phrases of the Internet era has been “Do you get it?” Or, as a compliment, “She gets it.” Maybe you “got it” a long time ago, and now have a Web site that is the envy of your colleagues and competitors. The question is, what about your insur- ance? Does it “get it”? Probably not, but it’s trying. To illustrate, let’s focus on the Insurance Services Office (ISO) 2001 General Liability program revisions to the standard Commercial General Liability form (CG 00 01 10 00). Until this revision, any such exposure was treated under the form wording by analogy. With this revision, ISO has included the first specific references to Internet exposures. Although relatively few in number, they give some indication of the types of exposures you should be considering as you expand your Web presence. For example, the primary focus of the Internet references is under “personal and advertising injury.” The reasoning is that the Internet is unlikely to greatly increase your business exposure to bodily injury and property damage. (How would the Internet injure you physically, with the possible exception of creating carpal tun- nel injury and eyestrain?) But for the mental damages encompassed by the def- inition of “personal and advertising injury” (such as false arrest, slander, libel, or infringement of copyright), the Internet clearly represents a powerful potential cause of loss. You might, for example, make a libelous remark in a bar and few would know. Make that same com- ment on a Web site and the world could see it. Clearly, the exposure has expanded exponentially. So it’s not surprising that ISO’s first Internet-specific exclusions apply to activities such as advertising, hosting or control of chatrooms, and those in the business of providing Internet access or content. As you pursue your Internet strategies, include our professionals in the discussion. We can help point out the issues, examine the risks, and deter- mine the coverages that may or may not yet exist for your exposures. As you “get” the Internet, let’s try not to let the Internet “get” you. Understanding Liability Insurance and the Internet One Claim, Multiple Policies
Thank you for your referrals. If you’re pleased with us, spread the word! We’ll be happy to give the same great service to all of your friends and business associates. D ue in part to corporate scandals in the board room, insurance costs for execu- tives continue to escalate. According to a survey by the consulting firm Tillinghast-Towers Perrin, premiums for directors and officers liability (D&O) insurance rose an average 33% last year, up from a 29% increase for 2002. This increase reflects continued concern over high-profile bankruptcies, corporate scandals, and D&O lawsuits — particularly securities and shareholder litigation. The average amount of coverage accepted by U.S. participants was $18.9 million in total limits, down slightly from last year ($20.1 million). Survey participants who decided not to have D&O insurance cited both a lack of need for coverage and the high cost as primary reasons. Private firms with fewer than 500 shareholders were less than half as likely to encounter a D&O claim as their publicly traded counterparts. Companies with a history of merger and acquisition (M&A) or divestiture during 2003 were more than twice as likely to experience a claim against their directors and officers. Insurance Costs Rise for Executives


       
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