JUVE Law Firm of the year

Insurance Contracts: Litigation and Product Advice

New risks and more competition

The spectacle of the cyber attacks of summer 2017 made it clear to everyone that the advance of digitalization has brought with it real risks, for which insurers have been preparing special offers for several years already. Data losses and the costs of restoration efforts can become fatal threats precisely for those companies that have invested a great deal in their own digitalization process.

Rising Internet criminality and so-called fake president cases (where fraudsters pretend to be CEOs in an attempt to convince employees to make bank transfers) are further risks increasingly faced by companies. BLD Bach Langheid Dallmayr recently set up a team specifically for advice on topics such as autonomous driving, Industry 4.0, and smart home, as well as other cyber and digital issues.

Ruling: direct action against D&O insurers now possible

But many delicate liability scenarios dealing with real or purported errors on the part of executive boards or managers are still the focus of ongoing disputes. A ruling by the Federal Court of Justice (Bundesgerichtshof) that allowed for companies to take direct action against a manager’s D&O insurer thus drew much attention. The case was brought by an insolvency administrator and thus represents a further trend: many insurance specialists report that claims from insolvency administrators are on the rise, as the latter are using every tool at their disposal in what is already a litigious market climate.

Both for firms as well as for providers of insurance solutions, this development brings new players onto the scene. In addition to that of many smaller risk underwriting outfits, the arrival of Berkshire Hathaway Specialty Insurance on the German market in summer 2016 was carefully noted. “The prices for industrial insurance policies and D&O programs are falling, and the competition is getting tougher,” said one insurance specialist, and this seems to be the general observation.

Competition for Bach Langheid Dallmayr

The market had long gotten used to the leading position of BLD Bach Langheid Dallmayr in insurance. The firm earned its excellent position through a consistent focus on the industry and a quickness to recognize new developments, which it then implements through rigorous management. Several of its partners today rank among the most distinguished D&O specialists. But in the meantime, new competitors have come to the fore and these have by no means gone unnoticed when insurers are looking for counsel.

One example is international competitor Clyde & Co, whose office is only one year old and has already seen a strong performance. Like Ince & Co in Cologne, the Clyde team brings with it a mature and specialized network that speaks to the increasing internationalization of contracts and damages claims. BLD reacted to this only a few months later by formally establishing its own international network with one leading specialist firm in insurance each from the US, Britain and Australia. “The insurers will be delighted that they now have a greater selection to choose from,” remarked a lawyer from a major law firm well-versed in liability cases.

But in the context of the intensifying discussions about risks, liability and compliance, advisors to industrial companies that have risks to cover are also increasingly important. Wilhelm has made a name for itself in this respect. In the meantime, however, other firms such as Noerr and CMS Hasche Sigle are increasingly discovering this demand.

 

This subchapter concerns firms that have expertise in insurance contracts. A number of large law firms have also set up their own litigation practices, which act for insurers in liability and recourse cases, as well as arbitration proceedings. Such firms can be found in the ?commercial litigation and liability chapter.


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