Lawsuits related to climate change could expand faster than the explosion of asbestos claims and have significant impact on insurers, Swiss Re is warning in a new report.

The Zurich-based firm, in an examination of the consequences of globalization of class actions on insurers, said, “We expect, however, that climate change-related liability will develop more quickly than asbestos-related claims and believe the frequency and sustainability of climate change-related litigation could become a significant issue within the next couple of years…”

The company advised, “Given the potential implications of this shift for the insurance industry, developments need to be monitored closely.”

At the moment, the report noted, while a legal basis has been established in the case of a climate change-related lawsuit against a public entity, there had not been a similar standing against a private entity through 2008.

Read the full story here on the National Underwriter website.

Just as the Great Depression led to the creation of new institutions and financial practices, the Obama administration is on track to impact financial regulations. One of the new concepts involves a financial stability regulator, David Wessel explains.

A federal class action claims Express Scripts allowed unknown people to gain confidential information of its members. The lead plaintiff claims Express Scripts got an extortion letter in October 2008, threatening to publish confidential information of millions of Express Scripts members on the Internet.

The letter included confidential information of 75 members, including Social Security numbers and prescription information, the suit states.

Named plaintiff John Amburgy claims Express Scripts waited nearly a month to issue a vague statement on its Web site on Nov. 6, 2008 and a second statement on Nov. 11, that admitted some Express Scripts members had received similar letters. Express Scripts announced that it knows where the information was accessed but was still investigating how it was accessed, the suit states. But five months later, Express Scripts still has not announced how many members have had their confidential information compromised, the suit states.

Read the full story here on the Courthouse News Service Website.

Regulators around the world have been shaken by the downfall of American International Group, once seen as the pinnacle of well-managed international insurance groups.

The harshest aspect of AIG's difficulties is that its problems originated not within its far-flung collection of insurance operations, but in a securities trading wing. Like other groups that have run into trouble--Aegon, ING, Swiss Re--AIG's top-rate insurance subsidiaries were fine (or could have been fine) on their own. But problems within banking, trading and capital markets operations posed what, in the current fashionable parlance, amounted to enterprise-wide risk.

Read the full story here on the InsuranceNewsNet website.

Warren Buffett memorably wrote: 'You only find out who is swimming naked when the tide goes out'. He was talking about the ability of re-insurers to pay out on a vast catastrophe-related insurance loss in an unfavourable economic environment.

Yet his words could just as easily be applied in the context of the Madoff and Stanford scandals. The economic tide has rapidly receded and many assumed to be suitably attired have been embarrassingly exposed.

Bernard Madoff has admitted to one of the biggest frauds ever committed, and although it remains to be seen whether Allen Stanford has committed any offence, the SEC has levelled substantial civil claims against his business interests.

Read the full story here on Daily Mail Online.

House members today introduced a bill, H.R. 2554, that would create the National Association of Registered Agents and Brokers.

The bill has the support of the Independent Insurance Agents and Brokers of America, Washington, a property-casualty trade group, and the National Association of Insurance and Financial Advisors, Falls Church, Va., a group that represents life and health producers.

The bill would preserve state insurance regulation and consumer protection provisions, and it would require agents applying for NARAB membership to submit to a criminal background check.

The bill was introduced by Reps. David Scott, D-Ga., and Randy Neugebauer R-Texas. The bill has strong bipartisan support. More than 30 members of the House signed on as original cosponsors, according to representatives of the IIABA and NAIFA.

Read the full article here on the National Underwriter website.

U.S. banking regulators have the authority to oust executives and directors of institutions receiving federal bailout dollars, leaving many analysts and academics to wonder whether government officials will move to shake up the corporate leadership at reeling banks.

"There will be some [government] pressure for certain executives to step down. Citigroup will be first, other than GMAC, but there will be more resignations," said Christopher Whalen, managing director of Institutional Risk Analytics, in Torrance, Calif. "With Citi, we taxpayers are effectively guaranteeing their debt, they are effectively nationalized already, so bank regulators definitely have the power to force bank CEOs to resign."

Read the full story here on the MarketWatch website.

That's a nice headline for a Wednesday.  This article, an Advisen MSCAd featured case written by John W. Molka III, gives detail to a case where the lawsuit and award comes from the negligent handling of a corpse.  Most HPL policies define medical professional services to include postmortem handling.

You can read the full story here on Advisen.

The House passed legislation Monday that would give the federal government new tools to pursue financial fraud, clearing it for President Barack Obama to sign into law.

The bill, which the Obama administration strongly supports, would also create a 10-member commission to study the causes of last year’s financial meltdown. The House passed it by 338-52. The Senate overwhelmingly approved the measure last month.

The measure expands federal fraud laws to cover mortgage lenders that the federal government doesn’t regulate. It would also expand those laws to cover money spent under the $700 billion Troubled Asset Relief Program, which helps ailing financial institutions, and this year’s $787 billion economic-stimulus plan.

Read the full story here on the Star-Telegram website.

Only those customers who weren’t reimbursed for fraudulent charges may sue the Hannaford Bros. supermarket chain over a data breach that exposed 4.2 million credit and debit card numbers to computer hackers, a federal judge ruled.

The decision by U.S. District Judge D. Brock Hornby on Tuesday dismissed all but one of the civil claims brought against Hannaford after the data breach was revealed in March 2008. But a separate lawsuit is still pending in Florida against Hannaford’s sister company, Tampa-based Sweetbay.

Between Dec. 7, 2007, and March 10, 2008, hackers accessed card numbers used at 165 Hannaford stores in the Northeast and 106 Sweetbay stores in Florida. At least 1,800 numbers were stolen and used for unauthorized purchases, Hannaford officials have said.

Electronic payment processing services for the transactions took place in Maine, where Hannaford is based. And lawyers agreed last month that Maine law should apply.

Read the full story here on the Bangor Daily News website.

Did fair value accounting standards, issued by the Financial Accounting Standards Board, and required to be applied for fiscal years ending subsequent to November 2007, hasten the onset of the current economic and financial crisis? What will be the impact of these standards on legal and accounting activities in the future? What will be the impact of FASB's April 2009 rule change giving financial institutions more flexibility in valuing assets?

Steven M. Packer and Stanley V. Todd, members of the Tax Accounting Group at Duane Morris, tackle these questions in an article that appeared in The Legal Intelligencier.

You can see the full article by clicking here.

This is a link to the live video of the CEO of AIG testifying before Congress on the financial stability of the company after receiving more than $180 billion in federal bailout money.

http://www.msnbc.msn.com/id/22887506

An insurance company does not have to cover more than $800,000 in legal fees racked up by a client defending a patent infringement suit because the action was brought by a vendor, not a customer, and did not fall under the professional liability coverage of the policy, the Pennsylvania Superior Court has ruled.

The ruling in Transcore v. Caliber One Indemnity Co. is a win the for the insurance company that was appealing a Philadelphia judge's ruling requiring the company to cover the legal fees.

The court, in an opinion by Judge Richard B. Klein, said there were two aspects of Caliber One's policy for Transcore and its subsidiary, Amtech, that prevented coverage. Because the patent infringement action was brought by another vendor with no relationship to Amtech, and not a customer, it was not a "professional liability" action under the terms of the policy.

"Second, this is an action for inducing a third party to violate a patent, not a direct patent infringement action," Klein said. "Because that patent action can only be brought if the violation is knowing, and there is an exclusion in the polic[y] for 'knowing' actions, there is no coverage for this action."

Read the full story here on the Law.Com website.

Late last week, the U.S. Court of Appeals for the Third Circuit made a substantial contribution to the list of important securities fraud cases interpreting the Private Securities Litigation Reform Act ("PSLRA") with a 91-page opinion in Institutional Investors Group v. Avaya, Inc., No. 06-4595 (3d Cir. Apr. 30, 2009).

This new opinion provides guidance on the types of forward-looking statements subject to protection under the PSLRA's so-called "Safe Harbors" for such statements, and further explains how courts should apply the Supreme Court's decision in Tellabs, Inc. v. Makor Issues & Rights, Ltd., 127 S. Ct. 2499 (2007), when determining whether a complaint's allegations raise a "strong inference" of scienter.

Read the full article, authored by Joseph O. Click, a Partner with the Blank Rome law firm, here on the Mondaq website.

While hedge funds around the globe are watching their investments go up in smoke, one fund - Juridica Investments - has been enjoying nice returns. How? It puts its money in lawsuits.

Launched in December 2007 by two lawyers, Richard Fields and Timothy Scrantom, Juridica gives money to Fortune 500-size companies or their lawyers in the early stages of corporate lawsuits in exchange for a share of the payout if the plaintiffs win or settle. (Think of it as a different form of investing in distress.)

With $200 million under management, Juridica has invested in 17 suits so far - and is two for two in decisions. Though Fields, 53, and Scrantom, 52, are based in New York City, they raised money by selling shares on the London Stock Exchange's small-companies market. The fund paid a dividend of about $5 million to investors last month after a big suit was settled. Juridica signs nondisclosure agreements, so it can't name names, but this one involved one hedge fund suing another for stealing an employee. Shares are up about 20% since the launch.

Read the full story here on the CNNMoney.Com website.

The 2009 PLUS Golf season is in full swing!  We have six upcoming golf outings to improve your golf game, network with your colleagues, and of course help raise money for the PLUS Foundation.

We have the following golf outings scheduled (click on the name to get more information):

May 11, New England Chapter Golf Outing, Cohasset Golf Club, Cohasset, MA

June 2, Hartford Chapter Golf Outing, The Ranch Golf Club, Southwick, MA

June 15, Southeast Chapter Golf Outing, Bear's Best Golf Club, Suwanee, GA

July 8, Midwest Chapter Golf Outing, St. Andrews Golf & Country Club, West Chicago, IL

July 14, Eastern Chapter Golf Outing, Echo Lake Country Club, Westfield, NJ

July 23, Nothern California Chapter Golf Outing, Presidio Golf Course, San Francisco, CA

By participating in or sponsoring one of these events, you are not only going to get the opportunity to network with your colleagues and improve your golf game, you are going to raise money for the PLUS Foundation - a leading philanthropic force in the professional liability community.  The Foundation brings people together to advance our profession, improve our communities and share the rich experience of contributing.

We hope to see you on the course this summer!

NEW YORK (Reuters) - American International Group Inc is expected to post a first-quarter net loss of about $5 billion when it reports results on Thursday, much lower than the record hit it took in the previous quarter, a source familiar with the matter said on Wednesday.

On an adjusted basis, AIG is expected to post a first-quarter loss of about $2.4 billion, which comes to a little less than 90 cents per share, the source said.

According to Advisen, the commercial insurance industry is exposed to a surge in securities litigation filings in the first quarter of 2009, according to results of a quarterly review of securities litigation by Advisen. Advisen tracked 169 securities cases in its Master Significant Case and Action Database (MSCAd), up from 125 cases in Q4 2008 and 134 suits a year earlier in Q1 2008.

Carpenter Moore Senior Managing Director Norman Allen discusses a recent Professional Liability Underwriting Society (PLUS) survey on the role of brokers in the claims process for Directors & Officers Liability and where tensions may exist. Also, how a broker helps define expectations not only of the client but also of the carrier.  From Insurance Journal TV.

President Barack Obama on Monday will propose changing provisions in the tax code that he says encourage U.S. companies to move jobs overseas, as part of a broader package aimed at saving $210 billion over 10 years.

U.S. officials said that in an announcement planned for 11:05 a.m. EDT, Obama will seek to follow through on a campaign promise to change the tax treatment of American firms with overseas operations.

That portion of his plan -- opposed by such firms as Pfizer Inc and Oracle Corp -- would raise more than $100 billion in revenue over the next decade.

Read the full story here on the Reuters website.