Chapter

Insurance Monitoring and Loss-Prevention Programs

in Ensuring Corporate Misconduct

Published by University of Chicago Press

Published in print January 2011 | ISBN: 9780226035154
Published online March 2013 | e-ISBN: 9780226035079 | DOI: http://dx.doi.org/10.7208/chicago/9780226035079.003.0007
Insurance Monitoring and Loss-Prevention Programs

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This chapter examines insurance monitoring and loss-prevention programs in the context of Directors' and Officers' liability (D&O) insurance. The findings reveal that D&O insurers neither monitor nor provide loss-prevention programs to the corporations they insure, and that, in the few cases that a loss-prevention advice is given, it is only done to promote or market the insurer rather than to constrain the conduct of the insured. The chapter provides an account for the absence of monitoring by insurers and highlights its implications, particularly moral hazard.

Keywords: insurance monitoring; loss-prevention programs; D&O insurance; insured; moral hazard

Chapter.  8677 words. 

Subjects: Company and Commercial Law

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