1. E&O/D&O COVERAGES AND TRENDS WEBB HUBBELL,CRM,CWCA VICE-PRESIDENT AND COUNSEL THE MCLAUGHLIN COMPANY WASHINGTON,DC 202-293-5566 WHUBBELL@MCLAUGHLIN-ONLINE.COM

2. THIS BUSINESS IS CYCLICAL UNDERWRITING -- SOFT MARKET 1991-EARLY 2001 2004 -- PRESENT LOTS OF CAPACITY

3. THIS BUSINESS IS CYCLICAL UNDERWRTING -- HARD MARKET 1986-1991 2001-2004 ?

4. WHAT HAS UNDERWRITERS NERVOUS? GLOBAL WARMING PROPERTY LOSSES CLAIMS AGAINST CONTRIBUTORS CONGRESSIONAL ACTIONS INVESTOR CLAIMS

5. WHAT HAS UNDERWRITERS NERVOUS? SUBPRIME CRISIS RISING DELINQUENCIES MORE THAN 50 MORTGAGE LENDERS BANKRUPT INSURANCE COMPANY AND PENSION PLAN EXPOSURE LAWSUITS AGAINST COMPANIES THAT INVESTED LAWSUITS AGAINST ORIGINATORS

6. WHAT SHOULD MAKE YOU NERVOUS CYBERISK Failure of your network security Failure to protect or wrongful disclosure of private or confidential information Failure to protect Personally Identifiable Information from misappropriation Violation of any federal, state or local privacy statute alleged in connection with failure to protect private information.

7. WHAT SHOULD MAKE YOU NERVOUS FIDUCIARY LIABILITY Ohio WC Fund Problems San Diego By one estimate, state and local governments owe their current and future retirees roughly $375 billion more than they have committed to their pension funds. Barclays Global Investments has calculated that if America’s state pension plans were required to use the same methods as corporations, the total value of the benefits they have promised would grow 22 percent, to $2.5 trillion. Only $1.7 trillion has been set aside to pay those

8. WHAT SHOULD MAKE YOU NERVOUS IMMUNITY Emergency Immunity

9. WHAT SHOULD MAKE YOU NERVOUS THIRD PARTY CONTRACTORS

10. WHAT SHOULD MAKE YOU NERVOUS EMPLOYMENT RELATED PRACTICES Three of five businesses will be sued this year by an employee or a former employee over an employment practice Employment practices suits account for 20% of all Federal Court filings 56% of all employment practice filings going to trial result in a verdict for the plaintiff employee The average jury award is S250.000, with 15% exceeding $1 million 33% of wrongful termination verdicts have punitive damages equal to or exceeding compensatory damage.

11. WHAT SHOULD MAKE YOU NERVOUS MEDIA LIABILITY BLOGS Newsletters Websites E-Mail Trademark and Copyright

12. WHAT SHOULD MAKE YOU NERVOUS KIDNAP AND RANSOM Foreign Travel E-mail Attacks

13. AFFIRMATIVE STEPS D&O COVERAGE ISSUES Appendix http://dandodiary.blogspot.com http://webbsays.blogspot.com

14. AFFIRMATIVE STEPS ERM/RM CRM RIMS

15. AFFIRMATIVE STEPS CONTRACT REVIEW Lawyers versus Insurance Consultants

16. APPENDIX