UK Law and Practice Contributed by: Daniel Robin and Chloe Franklin, SDV Fenchurch
4.9 Financial Lines Coverage Trends Financial lines disputes are being shaped by regu- latory scrutiny, insolvency risk, shareholder claims, professional negligence, cyber-incidents, ESG-related allegations and rising defence costs. D&O disputes commonly concern the scope of wrongful act word- ing, insured capacity, investigation costs, defence costs, aggregation, fraud and dishonesty exclusions, insured v insured exclusions and regulatory investiga- tion cover. Professional indemnity disputes often focus on notifi- cation, aggregation, exclusions, causation, loss allo- cation and whether the claim arises from professional services within the meaning of the policy. For financial institutions it is not uncommon for cover- age issues to arise because the nature of the financial institutions’ liability does not always fit squarely within traditional civil liability of crime covers. For example, the likelihood that its liability to other financial institu- tions is often likely to be contractual. However, most traditional liability policies contain contractual liability exclusions (albeit with certain carve-backs). 4.10 Casualty Coverage Trends Casualty disputes are increasingly driven by high-val- ue, long-tail and multi-party liability claims. Building safety, product liability, public liability, employer liabil- ity, environmental exposure, abuse claims and emerg- ing technology risks all create pressure on policy limits and historic insurance programmes. Coverage issues often concern trigger, causation, occurrence wording and allocation across policy years. Where injury develops over time, parties may dispute when the insured event occurred and which policy year is relevant. Where numerous claimants are involved, aggregation and limits become central.
gations, the scope of information requested, repeated requests for documentation, reliance on expert evi- dence and the timing of coverage decisions. The practical consequence has been a greater empha- sis on claims governance and record-keeping. Insur- ers are increasingly conscious that contemporaneous evidence demonstrating the reasonableness of their investigations may become important if allegations of late payment are subsequently pursued. Equally, poli- cyholders are increasingly scrutinising claims handling conduct as an additional avenue of recovery where coverage has been delayed for prolonged periods. 4.7 ESG and Climate-Related Coverage ESG and climate-related issues are increasingly rel- evant to underwriting, policy exclusions, D&O claims, professional liability, property damage and business interruption. Policyholders are seeking cover for phys- ical climate-related losses and liability exposures, while insurers are responding through more detailed underwriting, exclusions, sub-limits and scrutiny of climate-related disclosures. D&O policies may be particularly affected where claims are brought against directors or officers in con- nection with climate strategy, alleged greenwashing, corporate governance failures, regulatory investiga- tions or shareholder actions. 4.8 Delegated Authority and Claims Responsibility Where underwriting or claims handling is delegated to managing general agents (MGAs), third-party admin- istrators (TPAs) or coverholders, disputes can arise over authority, knowledge, waiver, responsibility for claims decisions, conflicts of interest and delay. From a policyholder perspective, a key issue is whether the conduct or knowledge of the delegate is attributable to the insurer. Disputes may also arise where the policyholder receives inconsistent information from brokers, cover- holders, MGAs or insurers, or where delegated claims handling affects the timeliness, fairness or transpar- ency of the claims process.
5. Claims Against Insureds 5.1 Key Exposure Areas for Insureds
Principal exposure areas include professional negli- gence, construction defects, fire and building safety, cyber and data incidents, D&O claims, regulatory investigations, product liability, public liability, envi-
254 I NSURANCE L I T IGATI O N 2026
CHAMBERS.COM
Powered by FlippingBook