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Pre-Answer Security: Regulatory Protection for Policyholders in an Age of Insecurity
When corporate policyholders sue their insurers, the roster of defendants often includes an “unauthorized” insurer, whether it be Lloyd's of London (which is licensed in only two states, though it writes as an eligible surplus lines insurer in some or all of the other states), a London Market Company, or a domestic insurer not licensed to sell insurance in the state where suit was brought. Such insurers have avoided many of the stringent state regulations that govern “authorized” insurers. But in the majority of states, those insurers are subject to a quid pro quo in exchange for enjoying relaxed regulation: Unauthorized insurers (whether foreign or domestic, “eligible” as surplus lines carriers or not) are subject to a pre-Answer security requirement. That is, before they may answer a Complaint against them, unauthorized insurers must post cash, securities, or a bond sufficient to satisfy any judgment that may be entered against them.
Although not a newly enacted requirement, the pre-Answer bond is often overlooked as policyholders and their insurers hurtle into fast-paced litigation. Because obtaining such a bond can be “good insurance” against either an insolvency or a post-judgment battle to collect, policyholders should consider enforcing their right to demand a bond when litigating against an unauthorized insurer. Indeed, this may be a rare instance in which policyholders and at least some of their insurers ' the authorized ones ' can agree, since in jurisdictions that apply the “all sums” rule a bond can help minimize the risk that the authorized insurers will be left paying the share of the judgment that would have been borne by the unauthorized insurer had the policyholder been able to collect it.
Why So Many Great Lawyers Stink at Business Development and What Law Firms Are Doing About It
Why is it that those who are best skilled at advocating for others are ill-equipped at advocating for their own skills and what to do about it?
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
A Lawyer's System for Active Reading
Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.
Blockchain Domains: New Developments for Brand Owners
Blockchain domain names offer decentralized alternatives to traditional DNS-based domain names, promising enhanced security, privacy and censorship resistance. However, these benefits come with significant challenges, particularly for brand owners seeking to protect their trademarks in these new digital spaces.