Excess Insurance Helps Businesses Protect Against Rising Litigation Risk
WARREN, NJ, April 11, 2006 - Each year businesses are increasingly at risk of being sued, and the rise in legal costs and jury awards means many businesses
may not be able to recover from a loss. With this in mind, the Chubb Group of Insurance Companies has updated its excess liability
policy, making it easier for insureds to design an insurance program that provides protection against catastrophic loss.
U.S. tort costs reached a record $260 billion in 2004, up $14 billion from the previous year, according to a Tillinghast report
released earlier this year. And Jury Verdict Research reported in 2004 that more than 8 percent of businesses experienced
a liability loss of $5 million or more in the previous five years. Many factors will continue to drive up the costs, including
an innovative plaintiff's bar, price inflation for legal services and medical care, and an increased number of class-action
lawsuits.
Chubb's Commercial Excess Follow Form Insurance helps protect against the threat of these exposures. It can be written over and follow the terms and conditions of any number
of umbrella or primary policies, including general liability (both domestic and global), errors and omissions, aviation, marine
and others.
"We understand that all it takes is one big loss to do irreparable harm to a business," said Michelle Middleton, a senior
vice president at Chubb & Son and global excess/umbrella manager for Chubb Commercial Insurance. "Chubb has been providing
excess insurance to our clients for more than 25 years. With our Commercial Excess Follow Form Insurance, we have created an excess policy that can mesh well with underlying policies to offer even greater protection."
Chubb's Commercial Excess Follow Form Insurance:
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Pays on behalf of the insured, so the insured doesn't have to pay losses first and seek reimbursement afterward;
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Remains valid even if the insured fails to maintain the underlying insurance or the underlying insurer becomes insolvent;
and
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Protection is not restricted by the exclusions, definitions or other provisions of intervening layers of insurance. Protection
follows designated underlying insurance.
"Because most businesses are not able to absorb a significant financial blow, they are vulnerable to the risk of lawsuits,"
Middleton said. "Our updated excess policy makes it easier for businesses of all sizes to design a vertically consistent insurance
program that best protects them and matches their needs."
The member insurers of the Chubb Group of Insurance Companies form a multi-billion-dollar organization providing property
and casualty insurance for personal and commercial customers worldwide through 8,000 independent agents and brokers. Chubb's
global network includes branches and affiliates in North America, Europe, Latin America, Asia and Australia.
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