Aren’t they presumed innocent untill? How can the D&O policy decline defense prior to ajudication? Is there clause that excludes defence when the client is proscuted for fraud? If that’s the case, the D&O policy won’t defend against false accusations, of which many law suites stem form.
Need a D&O expert to explain why no coverage for defence with more detail than just “it aint covered”.
As a D& O expert, Lloyds would be required to defend Sanford under the D & O policy if the petition gave any inclination or allegation that fraud, or deceptive practice could be construed as negligence. The mere fact that fraud was alleged is exclusion under the Lloyd’s policy. However, if negligence was alleged by he prosecuting attorney, Lloyds would have to defend the entire lawsuit as fraud could be construed by a jury as negligence. At this point, Lloyds can simply say they will not defend if “fraud” is alleged pursuant to the policy language. Therefore,Sanford will have to defend himself or try to get the prosecuting attorney to allege negligence which would trigger the policy. If the court rules that Mr. Sanford was negligent or could be negligent taken from the language of the petition, then Lloyds would have to pay a defense for Mr. Sanford and any damages to the victims. The Calvary will arrive if Mr. Sanford is found guilty for negligence. I am afraid Mr. Sanford will have to hold out until the prosecuting attorney alleges negligence or Mr. Sanford is found guilty of negligence by the courts. For now, Mr. Sanford is on his own. The prosecuting attorney knows how a policy reads and in my opinion deliberately kept out the word “negligence” so that Mr. Sanford would not have the defense from Lloyds of London. It is not Lloyds fault that the prosecuting attorney didn’t allege “negligence” which would have triggered a defense cost to Mr. Sanford.
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Aren’t they presumed innocent untill? How can the D&O policy decline defense prior to ajudication? Is there clause that excludes defence when the client is proscuted for fraud? If that’s the case, the D&O policy won’t defend against false accusations, of which many law suites stem form.
Need a D&O expert to explain why no coverage for defence with more detail than just “it aint covered”.
Thanks,
Omni NOT SO Sure
As a D& O expert, Lloyds would be required to defend Sanford under the D & O policy if the petition gave any inclination or allegation that fraud, or deceptive practice could be construed as negligence. The mere fact that fraud was alleged is exclusion under the Lloyd’s policy. However, if negligence was alleged by he prosecuting attorney, Lloyds would have to defend the entire lawsuit as fraud could be construed by a jury as negligence. At this point, Lloyds can simply say they will not defend if “fraud” is alleged pursuant to the policy language. Therefore,Sanford will have to defend himself or try to get the prosecuting attorney to allege negligence which would trigger the policy. If the court rules that Mr. Sanford was negligent or could be negligent taken from the language of the petition, then Lloyds would have to pay a defense for Mr. Sanford and any damages to the victims. The Calvary will arrive if Mr. Sanford is found guilty for negligence. I am afraid Mr. Sanford will have to hold out until the prosecuting attorney alleges negligence or Mr. Sanford is found guilty of negligence by the courts. For now, Mr. Sanford is on his own. The prosecuting attorney knows how a policy reads and in my opinion deliberately kept out the word “negligence” so that Mr. Sanford would not have the defense from Lloyds of London. It is not Lloyds fault that the prosecuting attorney didn’t allege “negligence” which would have triggered a defense cost to Mr. Sanford.