Lawyers are reporting that the Securities and Exchange Commission (SEC) is increasing the expectations that publicly-traded companies should outline climate change related issues. As a sample description of this trend, see this Advisory to from Sullivan and Worcester.

Failure to notify shareholders of the impact of operations on climate change may leave management exposed to extensive securities litigation with little ability to offer a strong defense. Directors & Officers ( D & O) Liability Insurers are still studying these SEC developments but it would not be surprising to see more emphasis on these issues at upcoming renewals.

Austin, Texas, Police Chief Art Acevedo stopped short of calling the crashing of a small plane into a commercial office building in northwest Austin on Feb. 18 a terrorist act, but U.S. Representative Mike McCaul said he wasn’t so sure it couldn’t be considered one.

The Piper Cherokee PA-28 piloted by Joseph Andrew Stack, 53, crashed into a multi-story office building that housed a U.S. Internal Revenue Services office with 190 employees shortly before 10 a.m. on Feb. 18.

While this may just seem a matter of semantics for journalists, but this is a critical question in insurance.

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WGA client, Ironwood Pharmaceuticals, completed their initial public offering of stock earlier this week.  Ironwood sold 16.7 million shares at $11.25 per share.  They ended up their first day of trading up by more than 3%.  The gross proceeds of over $187 MM were the most raised by a biotechnology R & D company since 2002.  Their post-IPO market capitalization is over $1B.

One significant new expense for a company going public is the greatly heightened cost of Directors & Officers Liability Insurance. This is due to the increase in risk exposures arising out of a plethora of new shareholders.  Securities litigation, in particular, becomes much more likely for publicly-traded companies.  Read more…

One casualty of the economic downturn has certainly been the confidence of consumers to make investments. Big ticket items ranging from new houses, home improvements, new cars, and even private school tuitions have all shown the impact of the decline in consumer sentiments. The problem, of course, is that consumers are afraid of making new commitments when they fear that they might lose their jobs.

Some companies, Kia Motors was first to the fore, have worked to offset that fear by offering assurances that payments will be suspended should a bread-winner in the family lose their job. Lloyd’s of London has taken this idea to a higher level and is offering insurance for banks, private schools, manufacturers and other entities hurt by this negative sentiment. In return for relatively modest premiums, companies can offer this unemployment insurance to its customers.

So, adversity breeds innovation. And perhaps consumer psychology can be bought for a relatively small price.

Sometimes a step back is required in order to evaluate the progress of the Health Care Reform debate. We are getting much, much closer to a bill passing the United States Congress to produce changes to our system of health care delivery that will impact almost everyone in the country. So, what are the challenges? Three big ones: getting access (insurance) for more persons; insurer practices, particularly in the individual market that punish individuals when they most need insurance; and reducing the overall cost of health care.  Read more…

I recently heard Atul Gawande, a brilliant doctor at Brigham and Women’s Hospital in Boston and an acclaimed writer, speak about Risk Management. Well, he did not mention those two words but that was my takeaway.

Gawande has been writing about issues in Health Care for many years. At the Harvard Club discussion, he spoke about the tracking and scheduling of items in the building of a large new office tower in Boston. Unlike with the building methods of a hundred years ago, one no longer can entrust the constuction process to the mind of one person, not even the most experienced master builder. Read more…