Product Liabilities in an Assets-Only Sale

Background
A mid-size technology parts manufacturer with global sales over $20,000,000 was planning to sell a division using an“assets only” approach.

Problem
Management was understandably nervous about ongoing liabilities for sold products already in the marketplace. While the company could relatively easily continue to carry a sold division’s name on ongoing insurance when operations of the parent company are continuing, the challenge was to put a program in place prior to the sale that would protect the officers and boards once the company had folded.

Solution
N.P. James Insurance Agency recommended securing continuing insurance risk protection for the offi cers and board. A team including an underwriter was put together to work with the company’s legal representatives to structure a program that would cover past products once the company was sold.

Results
The technology manufacturer moved ahead with the sale after securing a specifically designed and well-defined program to cover the identified risks.

Securing Coverage for Products Sold Globally

Background
A large component manufacturer, primarily serving defense contractors, came to N.P. James Insurance to help understand their exposures for travel, shipping, and global liability for internationally exported products.

Problem
We advised the client that while standard domestic property/liability insurance programs offer “worldwide” coverage, they cover only suits first brought in the U.S.A. local foreign court is likely to see an overseas suit first, which would result in a denial of coverage by the U.S. insurer. In addition, the client had not secured global coverage for products, operations, travel, and employee assistance.

Solution
With tighter regulations and sanctions in world trade blocs, blunders in risk protection can be very costly. We researched and recommended a comprehensive global insurance program that mirrors domestic package at a low cost.

Results
The client now has protection for not only its products but also operations, travel, and employee assistance for its international business.

Special Policy Needed for Aircraft Applications

Background
A long-time software developer client with worldwide revenues over $50,000,000 let us know that aircraft manufacturers are using their product for component analysis.

Problem
Even if that software application never leaves the ground, any products used around aircraft, aerospace, or airports need special attention for associated risks. Any liability associated with aircraft is excluded on standard general liability policies. In order for the general liabilities insurer to assume the remaining product risks, they required an aircraft-specific policy.

Solution
N.P. James Insurance Agency identified and recommended a specialty aircraft product liability carrier to assist with placement and pricing.

Results
The software developer acquired the necessary policy at a reasonable price and the GL carrier was satisfied.

Shark-Infested Cyberspace
& Privacy Issues

Background
Today’s businesses have opportunities to broaden their reach and efficiencies with e-commerce, multi-emedia advertising, and cloud computing.  These innovations also pose challenges with new legislation tightening privacy and data security obligations.  As privacy and data security risks continue to grow, they burden American businesses in addition to the normal risks associated with products and services.  Businesses must continuously assess the increasingly complex risks assumed with internet opportunities.

Problem
Under growing privacy legislation, most internet and wireless transmissions from devices are in non-compliance should “restricted” information be discussed or transmitted over easily (or accidentally) intercepted channels.  It appears that few people understand the statutes, including law enforcement, police and fire, the  attorney general’s offices, the federal government, and most lawyers.  Ugly consequences such as litigation, fines, and unwanted publicity are issues senior management must work to address.

Solution
All enterprises conducting on-line transactions are prudent to purchase insurance coverage “modules” for protection of “sensitive” data, both electronic and hard-copy.  Most businesses with experienced management are looking at the cost-benefit of privacy and network security insurance for both client and employee data together with implementing rigorous security measures.