The past several years have been marked by numerous, high-profile investigations by regulators and lawmakers investigating a variety of business practices and senior company executives. While certain types of investigations appearto have leveled off, otherslook poised for an expansion. Anyone embroiled in past regulatory investigations can attest to the enormous costs involved in dealing with an investigation.
Commercial-lines insurance coverage under a few different policy form types may help businesses cope with the enormous expenditures occasioned by addressing an investigation or inquiry. But, even with those insurance policies which expressly promise coverage for the costs attendant to investigations, insurance companies often contest such claims and seek to apply the most narrow interpretation possible of the coverage grants and terms. As such, it is critical that policyholders take an inventory of their commercial crime and liability insurance policies to determine what level of insurance coverage may be available should they become the target of an investigation or should they be required to perform an internal investigation. Policyholders should check their D&O, E&O, fiduciary liability, commercial crime, and computer crime insurance policies to determine the availability of insurance coverage.