Hunton Insurance Recovery Blog

The mantra “delay, deny, defend” is frequently referenced in discussions of insurance claims handling, though insurers will invariably disavow these tactics. While it would be facially improper for an insurer to delay a coverage decision to gain a tactical advantage, empirical examples nonetheless exist. This very dynamic was addressed by Florida’s Fourth District Court of Appeals when it handed policyholders a win in Hypoluxo Mariner’s Cay Condo. Ass’n, Inc. v. Underwriters at Lloyd’s London, No. 4D2024‑2250 (Fla. 4th DCA Apr. 1, 2026), reversing a trial court order dismissing a condominium association’s Hurricane Irma coverage lawsuit against its property insurer.

In a recent client alert, Hunton insurance attorneys Geoffrey B. Fehling and Charlotte E. Leszinske discuss D&O insurance considerations for shareholder derivative liability claims.  A recent complaint filed in the federal court alleges that an opportunistic investor used his status as a shareholder to pressure the company into business deals that would benefit him personally, on threat of a derivative action.  See Maddox Defense, Inc. v. Envirotech Vehicles, Inc. v. Diveroli, et al., No. 26-cv-2992.  The shareholder is alleged to have held himself out as the company’s representative in a lucrative government contract, and when things went south, sued.  He then allegedly offered to drop the lawsuit if the company entered into different contracts to its detriment and his benefit.

The decision underscores the importance of maintaining D&O liability insurance to protect against shareholder lawsuits, especially those brought derivatively on behalf of the company, as those claims can pose unique challenges on indemnification, exclusions, and other coverage issues. 

As reported in the Washington Post, the cost of cargo theft losses in the US is surging, even though the number of reported incidents has not changed. This surge reflects the type of cargo being stolen: thieves are targeting high-value technology, including electronics, computer chips, and servers destined for high-tech facilities and data centers. These components can be worth tens of millions of dollars per shipment, thus making proper insurance more important than ever.

While cargo theft is not a new risk, the escalating value of stolen goods marks a notable shift in the exposure landscape. For commercial policyholders, this trend raises important insurance and risk management considerations—particularly whether existing cargo, inland marine, and stock throughput limits remain adequate in light of evolving loss severity.

Policyholders facing coverage denials under directors and officers liability policies often hear the same refrain from insurers: because the underlying claims involve a contract, coverage is barred under a contractual liability exclusion. In The Cincinnati Insurance Co. v. Metropolis Condominium Association, No. 24-C-4328 (N.D. Ill. Mar. 31, 2026), an Illinois federal judge issued an important reminder that contract-exclusion analysis is not that simple.

Hunton is pleased to share that insurance coverage associate Jae Lynn “JL” Huckaba has been elected to serve as President-Elect of the Miami Dade Bar Young Lawyers Section (YLS). JL’s year-long term is set to begin this month.

A federal court decision in Navigators Specialty Insurance Company v. SVO Building One, LLC emphasizes the breadth of the duty to defend under California law and the difficulty insurers face when attempting to allocate defense costs between covered and uncovered claims. The insurance dispute between Navigators and SVO arose from a lawsuit by an equipment manufacturer, Vertiv, against SVO, a data center designer, involving a data center project.

In a recent commentary published by Thomson Reuters, Hunton attorneys Michael S. Levine, Geoffrey B. Fehling, and Alex D. Pappas discuss important insurance considerations arising from the growing use of physical AI in real-world settings.

The article explores the emerging risks associated with physical AI, including bodily injury, property damage, and business interruption, and examines how both legacy insurance products and newer AI-specific policies may respond to those exposures. It also underscores the importance of proactively evaluating AI-related risks when reviewing insurance programs, negotiating vendor protections, and preparing for evolving underwriting and claims issues.

The New Jersey Supreme Court ruled in Mist Pharmaceuticals, LLC v. Berkley Insurance Company that a D&O insurer did not forfeit its right to rely on a capacity exclusion after partially funding years of litigation, repeatedly representing that partial coverage was available, and waiting five years to fully disclaim. While the Court ultimately enforced the exclusion, the decision offers several important takeaways for policyholders, particularly with respect to reservation of rights letters, settlement strategy, and D&O policy drafting. 

Hunton insurance partner Koorosh “KT” Talieh was recently named President of the American College of Coverage Counsel (ACCC), a distinguished organization of approximately 475 leading insurance coverage litigators. A longstanding fellow of the ACCC, KT previously served as president-elect, secretary/treasurer, and co-chair of the organization’s Membership Committee.

The Fourth Circuit in APAC-Atlantic, Inc. v. Owners Insurance Co., No. 24-1969, 2026 WL 458402 (4th Cir. Feb. 18, 2026) recently endorsed broad coverage for additional insureds, interpreting “arising out of” broadly under North Carolina law to extend coverage to a repaving company under its subcontractor’s liability insurance policy. The court held that an additional insured’s liability “arising out of” a named insured’s work in an additional-insured endorsement means liability “relating to” or “causally connected to” the named insured’s operations, rather than liability defined more narrowly as “caused by” or “the fault of” the named insured.