Policyholder Pulse

You Paid for It. Are You Using It? Why Buyers Should Actively Manage Their Representations and Warranties Insurance Policies

Mark J. Plumer and Max D. Cardin — Wed, 29 Jul 2026 21:03:57 +0000

Representations and Warranties Insurance (RWI) has become a standard deal tool. Buyers purchase it to obtain recourse independent of the seller. RWI can strengthen a Buyer’s bid for attractive targets while giving Sellers a clean exit: no indemnity, minimal escrow and little post-closing exposure (absent fraud). Commentators have devoted much attention to RWI’s role in […]

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The Last Word on CGL Coverage for Expanding “Public Nuisance” Torts Is Still to Come

Lisseth Ochoa-Chavarria and Chris Popecki — Thu, 23 Jul 2026 22:29:10 +0000

Over the last decade, governmental plaintiffs have secured tens of billions of dollars in settlements from certain manufacturers, wholesale distributors and pharmacy operators that allegedly contributed to a nationwide epidemic of opioid use disorder (OUD), a/k/a addiction. Bellwether litigation has centered on expansive “public nuisance” claims—reminiscent of covered pollution and gun violence claims that surfaced decades ago—alleging that defendants throughout the opioid supply chain caused and must remediate widespread OUD by changing their practices and funding the treatment of persons who sustained opioid-related injuries. Encouraged by the settlement leverage opioid claims generated, the plaintiffs’ bar has expanded public nuisance litigation in cases involving climate change, ultra-processed foods, lead paint and, more recently, social media.

AI Exclusions in Insurance Policies: Broad Language, Uncertain Impact

Jay Konkel and Hadhy Ayaz — Mon, 13 Apr 2026 23:26:28 +0000

As generative artificial intelligence (gen AI) becomes embedded in day-to-day commercial operations across virtually every sector, businesses are confronting a parallel rise in litigation and regulatory risk tied to AI development, deployment, and disclosure. Insurers are responding in kind. Perhaps in recognition that many traditionally worded liability policies may otherwise respond to AI-related claims, a growing number of carriers have begun introducing exclusions and endorsements aimed at narrowing or eliminating coverage for these exposures.

Delaware Supreme Court Rejects Application of the “Bump-Up” Exclusion in Harman Decision

Tamara D. Bruno, Chris Popecki and Hadhy Ayaz — Wed, 25 Mar 2026 19:46:42 +0000

When corporate transactions engender shareholder litigation, Directors’ and Officers’ liability insurers all too often invoke the so-called “bump-up” exclusion to bar coverage of such claims. These provisions, common in D&O policies, purport to exclude coverage for settlements or judgments that effectively increase the deal price in acquisitions, the theory being that D&O insurance was not intended to act as a backstop to the share price obtained by management in selling a company. D&O insurers have for years tried to expand the application of these provisions in attempts to narrow Side B/C coverage for M&A transaction-related losses.

SDNY Rejects Insurer’s Attempt to Stretch D&O Policy’s “Subsequent Acts” Exclusion

Peter M. Gillon, Edward Flanders, Elizabeth J. Dye and Tamara D. Bruno — Wed, 18 Mar 2026 18:39:07 +0000

In a recent decision from the Southern District of New York, Judge Jed S. Rakoff rejected an insurer’s attempt to stretch a “Subsequent Acts” exclusion beyond its text and denied a motion to dismiss a policyholder’s coverage action. The decision in AmTrust Financial Services, Inc. v. Forge Underwriting Ltd. underscores a familiar but critical point in New York insurance law: exclusions are strictly construed, and insurers bear a heavy burden when they attempt to defeat coverage at the pleading stage.

[E]stopping Insurers from Taking Inconsistent Coverage Positions

Mark J. Plumer and Madison Kim — Tue, 17 Mar 2026 20:53:06 +0000

Most insurance policies use standardized wording drafted by the insurance industry. Coverage disputes frequently center on these standardized wordings. Policyholders only sporadically face significant claims that escalate into disputes with their insurers and result in litigation. Insurers, on the other hand, litigate identical or similar claims on a regular basis. Some issues lend themselves to […]

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Conflict Premium: Insurance and Supply Chains During the Iran War

Pillsbury's Insurance Recovery Law Team — Fri, 13 Mar 2026 21:43:02 +0000

Colleagues Joseph Jean and Meaghan Murphy recently authored a four-part series examining the myriad insurance considerations brought to the forefront by recent and ongoing events in Iran.

Part I – When Chokepoints Become Chokeholds
When trade routes detour, ports slow and sanctions tighten, the difference between a painful delay and an uninsured loss often comes down to a few lines of policy wording.

Part II – Business Interruption vs. the Supply Chain
Many BI and contingent BI disputes don’t turn on the headline event. They turn on the trigger: What, exactly, counts as a covered loss at a covered location caused by a covered peril.

Part III – Political Risk, Political Violence and the Sanctions Tripwire
Some losses don’t look like “property damage” at all. They look like government action, loss of control, blocked payments or a legal inability to perform. That’s where PRI/political violence wording—and sanctions clauses—do the heavy lifting.

Part IV – War Risks, Detention and the Courts
War-risk losses are rarely “mysteries.” They’re usually fights about ordinary words—“detainment,” “loss,” “costs,” “restraint,” “constructive total loss”—and about which section of a program pays when war is in the causal chain.

Pillsbury is helping clients navigate the shifting geopolitical, regulatory and economic landscape in Iran with informed insight and global perspective. Our experienced team of legal specialists, policy analysts, and former U.S. and UK government officials are actively monitoring the situation and providing integrated risk and response advice in connection with the immediate and long-term impacts of developments in the region.

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AI and Insurance Policy Interpretation After Snell v. United Specialty: What Policyholders Need to Know

Tamara D. Bruno and Shareen Sarwar — Wed, 25 Feb 2026 20:59:53 +0000

“I continue to believe—perhaps more so with each interaction—that LLMs have something to contribute to the ordinary-meaning endeavor. They’re not perfect, and challenges remain, but it would be myopic to ignore them.” —Judge Kevin Newsom

The decision by the U.S. Court of Appeals for the Eleventh Circuit in Snell v. United Specialty Insurance Co. will be cited often for its holdings on policy interpretation and insurance applications under Alabama law. Perhaps the most groundbreaking analysis, likely to have long-term ramifications for insurance coverage litigation, was Judge Kevin Newsom’s concurring opinion addressing the role of AI large language models (LLMs) in policy interpretation. For the first time in a federal appellate decision, a judge openly explored whether ChatGPT, Bard/Gemini and similar AI tools could help courts interpret insurance policy language. His concurrence provides a roadmap for how AI may reshape insurance disputes, and where policyholders must tread carefully.

Montrose Chemical Tees Up “Sudden and Accidental” Pollution Exclusion: Will California Supreme Court Follow Through?

David F. Klein and Jeffrey W. Mikoni — Thu, 19 Feb 2026 18:37:40 +0000

We are on the cusp of another milestone in the decades-long Montrose Chemical litigation, which has already yielded many important precedents in California on coverage for so-called “long-tail” pollution liabilities. “Long-tail” claims arise under historical comprehensive general, umbrella and excess liability policies for alleged pollution that was in progress through multiple policy periods—such as underground tank leaks, seepages from waste disposal impoundments, and similar occurrences taking place over time. Whether the so-called “qualified pollution exclusion” bars coverage for such long-tail claims is a question that has divided courts for decades. Now the California Supreme Court has agreed to hear a critical appeal that puts the interpretation of the qualified pollution exclusion in play—with potentially seismic impacts.

When the Storm Hits the Grid: Insurance Response After Widespread Power Damage

Janine Stanisz — Mon, 02 Feb 2026 19:13:39 +0000

It is nearly five years since the winter storms caused blackouts across Texas, when over four million customers lost power as the ERCOT power grid nearly failed. And while the Texas grid weathered the most recent winter storm, what’s clear is that demand and weather conditions continue to put immense strain on the nation’s electric […]

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