Executive Summary Blog

Executive Summary Blog

Legal developments affecting professional liability insurers

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Property Management and Financial Interest Exclusions Bar Coverage for Real Estate Professionals

Posted in Personal Profit/Advantage exclusion

Applying Connecticut law, a Connecticut state trial court has held that no coverage exists under a real estate errors and omissions policy for a lawsuit brought by property investors against two real estate professionals arising from the purported mismanagement of property investment companies.  Sarfaty v. United States Liab. Ins. Co., 2018 WL 3060110 (Conn. Super.… Continue Reading

Insurer Had Duty to Defend Where at Least One Allegation “Possibly” Constituted a Wrongful Act

Posted in Professional Services

The United States District Court for the District of Connecticut, applying Connecticut law, has granted summary judgment in favor of an insured, holding that an underlying complaint alleged at least one act that could “possibly” fall within the policy’s definition of “wrongful acts,” triggering a duty to defend.  Fernandez v. Zurich Am. Ins. Co., 2017… Continue Reading

Misappropriation of Funds Exclusion Precludes Coverage for Accounting Firm’s Erroneous Transfer of Client Funds to Third-Party Fraudsters

Posted in Uncategorized

A federal district court in Connecticut has granted an insurer’s motion to dismiss a breach of contract claim by an accounting firm, holding that the firm’s professional liability policy’s exclusion for theft, misappropriation, commingling, or conversion of funds precluded coverage for a claim against the insured for completing fraudulently requested transfers of funds.  Accounting Resources,… Continue Reading

Policy Rescinded And Voided Ab Initio For Failure to Disclose Professional Responsibility Grievance Investigation of Insured Officer

Posted in Rescission

Applying Connecticut law, a Connecticut federal court held that an insured’s E&O policy must be rescinded and voided ab initio after finding that the insured knowingly made misrepresentations regarding an investigation of one of its officers, which were material to the insurer’s decision to insure the applicant. Zurich Am. Ins. Co. v. Expedient Title, Inc.,… Continue Reading