Get the Low Down on the Melt Down: Subprime articles in ABA's Coverage publication
The July/August issue of Coverage, the publication of the Committee on Insurance Coverage Litigation (ICLC) of the ABA’s Section of Litigation features an article on insurance coverage issues arising from the subprime meltdown crisis. Written by Matthew L. Jacobs, Lorelie S. Masters and Daniel I. Weiner of Jenner &Block LLP, the article:
• Reviews the nature and possible causes of the subprime mortgage meltdown;
• Reports on trends in the litigation stemming from the impairment of the subprime realty market;
• Identifies the types of insurance coverage that are applicable to the meltdown crisis in that they are the most likely to be called upon to protect entities and individuals involved in mortgage lending and securitization procedures;
• Describes the potential defenses insurers may invoke to deny coverage;
• Analyzes potential duty to defend issues;
• Explores the applicability and effect of various types of severability provisions in the insurance policies;
• Discusses the risk of default given the widespread use of bond insurance; and
• Concludes with a look at the future in terms of mitigation of loss prospects, resolution of coverage disputes and insurer liability exposure.
Subscribers to Coverage on Lexis.com can read the article here.
That article comes on the heels of another article appearing in the May/June issue of Coverage, “Insurance Coverage Available for the Subprime Mortgage Collapse: Current Developments,” by William G. Passannante and Pamela Hans of Anderson Kill & Olick, P.C. It too identifies the variety of insurance policies implicated by claims against investment banks, mortgage companies and “virtually everyone involved in the securitization chain.” Among the current developments the article surveys:
• Investment banks are looking for financial assistance given the catastrophic losses they have incurred;
• Regulators are evaluating investment banks’ underwriting standards and other risk management practices;
• The impact of the subprime meltdown on mortgage insurance companies;
• Factors contributing to the meltdown;
• Current litigation arising from the meltdown; and
• The issue as to what triggers coverage of policy provisions encompassing “investigations by any governmental entity into possible violation of law.”
Subscribers to Coverage on Lexis.com can read the article here.