Section 9.38 “SEC” Exclusion

• Library: Insurance Practice 2015

Many director and officer liability policies contain a broad securities exclusion that exempts from coverage claims arising out of, based on, or otherwise involving the sale of the company’s securities. Some courts have held that the exclusion does not apply to sales that occur outside the context of the initial public offering. E.g., Alfin, Inc. v. Pac. Ins. Co., 735 F. Supp. 115, 119 (S.D.N.Y. 1990). Other courts, however, have interpreted the exclusion broadly. One court denied coverage for an...