Don't Let The Insurance Companies Stop Payment of Your Defense Costs

This article originally appeared in Anderson Kill's Executive Insurance Alert (Winter 2003/2004).

Advancement of defense costs, on a monthly or quarterly basis, is one of the most important rights provided to any policyholder in a Directors and Officers insurance policy. Recently, insurance companies have been attempting, however, to block such payments based solely upon the assertion that the policyholder made a misrepresentation in the policy application (which you as an outside director did not see, review or sign). Can D&O insurance companies negate such payments based upon mere assertions alone?