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Article: Market took off after directors, officers found personally liable; Two court rulings in 1968 brought risk to attention of executives; 1976 ruling opened the spigots of securities class actions.(Forty Years of BI)
- Article from:
- Business Insurance
- Article date:
- October 8, 2007
- Author:
CopyrightCOPYRIGHT 2007 Crain Communications, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Byline: DAVE LENCKUS
Insurers first offered directors and officers liability insurance 70 years ago, but the coverage did not draw insurance buyers on a large scale until the late 1960s, when courts began handing investors victories in securities litigation.
The first D&O policy, written by Lloyd's of London underwriters, appeared in the United States in the mid- to late 1930s after the enactment of the first federal securities laws, according to market experts.
"For the first time, you, as a director or officer, faced exposure'' over investors' losses, said policyholder attorney William Passannante, a partner with Anderson Kill & Olick P.C. ...