DENMARK Law and Practice Contributed by: Josefine Movin Østergaard and Johannes Hedegaard, Bruun & Hjejle
Logistics) that had assisted in procuring cargo insur- ance for a transport to Mali. The court acquitted both Tokio Marine and Maersk Logistics, holding that pro- fessional policyholders bear responsibility for verifying their coverage scope, even when relying on interme- diaries. The judgment underscores that in delegated authority arrangements, professional policyholders cannot simply describe their insurance needs and assume the desired coverage has been established – they must independently verify that the policy terms actually provide the coverage sought. Key challenges in coverage disputes involving del- egated authority include: • whether the agent’s actions bind the insurer, par- ticularly where the agent has exceeded its actual authority, but the policyholder relied on apparent authority; • responsibility for errors or delays in claims handling by third-party administrators; • the attribution of knowledge between the agent and the insurer for the purposes of coverage defences; and • the policyholder’s recourse where the delegated entity is insolvent or unresponsive. 4.9 Financial Lines Coverage Trends D&O Disputes As litigation funding has become more common, there has been a noticeable rise in large group actions against major Danish companies, many of which trig- ger coverage under D&O insurance policies. These cases frequently involve substantial claims for dam- ages, and the volume of case material can be consid- erable, resulting in significant legal costs for insurers defending such claims. For example, a number of Danish and international investors filed several class actions against the Danish bank “Danske Bank” and several individuals, seeking damages for share price declines and violations of disclosure requirements following the money launder- ing case relating to the bank’s Estonian branch. In November 2022, the District Court of Lyngby consid- ered one of the investors’ claims for approximately DKK2.4 billion against Danske Bank’s former CEO. The court dismissed the claim in its entirety, finding
that the CEO had not received information that could have resulted in the share price decline, and ordered the plaintiffs to pay legal costs in an amount of DKK10 million. Certain investors have appealed the decisions to the Danish Eastern High Court. The appeal remains pending before the Eastern High Court and has now reached an advanced procedural stage, with the main hearing scheduled for early 2027. At the same time, D&O insurance policies increasingly provide less coverage, resulting in several ongoing cases before the Danish courts. This has contributed to an emerging trend whereby large companies now enter into indemnification letters with board members and other relevant stakeholders to ensure the security of board members’ positions and the companies’ abil- ity to recruit and retain talent. W&I Disputes W&I insurance is increasingly common in M&A trans- actions, reflecting a market trend towards managing risks related to warranty breaches. As a result, M&A disputes are often very large and complex, involving high-value claims. In the Gram Equipment case, FSN Capital acquired Gram Equipment A/S from Procuritas Capital Inves- tors IV in late 2017/early 2018. Post-completion, FSN discovered that management had deliberately manip- ulated financial statements to inflate performance. FSN initiated arbitration against the seller vehicle (Green Magnum S.A.), resulting in liability for breach of warranties and an award of approximately EUR87 million. EUR50 million was paid under the W&I policy, but the seller vehicle went bankrupt and could not cover the remainder. FSN then sued the former CEO and CFO, Procuritas entities, and their former manag- ing partner before the Maritime and Commercial High Court for approximately EUR87.5 million (c. DKK650 million). On 3 November 2023, the court acquitted all defendants, finding that although management had acted negligently, FSN had not proven loss – an expert valuation assessed Gram Equipment at EUR60.2 mil- lion at closing, and FSN had already received EUR50 million from the W&I insurance. FSN has appealed to the Western High Court, with the main hearing sched- uled for autumn 2026.
95 I NSURANCE L I T IGATI O N 2026
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