Some states have laws which continue to restrict or prohibit the insurability of punitive damages, leaving insureds exposed to uncovered losses in the event of an otherwise covered claim. There are alternatives for securing broadened coverage for punitive damages; however, the pricing, terms and claims payment scenarios can differ significantly.
No one likes to imagine their company behaving in the sort of willful or egregious behavior that would lead a jury to consider awarding punitive damages. However, the risk of punitive damages is real and the awards can be substantial. It is prudent for a construction company to limit its exposure as much as possible, including by obtaining insurance that addresses punitive damages.
Swiss Re Corporate Solutions can provide a vehicle to address the insurability of punitive damages that conforms with state insurance requirements and is embedded in your core insurance program.
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Part of this article is excerpted from: https://media.swissre.com/documents/Punitive_Damages_in_the_US_052011.pdf
Insurance products underwritten by Westport Insurance Corporation, First Specialty Insurance Corporation, North American Capacity Insurance Company, North American Specialty Insurance Company, North American Elite Insurance Company, Washington International Insurance Company, or Swiss Re International S.E. This document is intended to be distributed to licensed insurance producers only. Nonadmitted insurance products are available only through licensed surplus lines brokers and may not be available in all states.