Dispute type
Securities Insurance
Risk transfer that may be arranged around the cost and capital profile of securities.
- A judgment or award won
- A judgment against youConsidered
- Funder capital deployedConsidered
- Law firm fees and WIP
- Security for costs
- The opponent's costsConsidered
- DisbursementsConsidered
- Own legal costs
Illustrative. The exposures a dispute can put on a balance sheet. What a policy responds to is set by its wording.
Can securities be insured?
Shareholder claims over misleading statements typically combine funding with ATE for the claimant group's adverse costs in loser-pays forums; defendants may consider adverse judgment cover for the downside above a retention.
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Key points
- Large claimant groups spread and complicate costs.
- Reliance and loss methodology are the key legal risks.
- Book-building affects the claim's value and structure.
The risk profile
Shareholder claims over misleading statements can involve large claimant groups, complex reliance and loss questions, and high costs.
Which structures apply
ATE for claimant groups in loser-pays forums, capital protection for funders, and adverse judgment cover for defendants in some cases.
Illustrative scenario
Institutional investors bring a claim under the Financial Services and Markets Act 2000 for misleading statements. A funder finances the claim and ATE covers adverse costs across the claimant group.
Figures are invented to show the mechanics. They describe no real client, matter or outcome.
Underwriting considerations
The misstatements alleged, reliance, loss methodology and book-building of the claimant group.
Frequently asked
Can shareholders bring a funded claim over misleading statements?
Yes, investor claims — for example under the Financial Services and Markets Act 2000 in the UK — are often funded, with ATE covering adverse costs.
How are costs shared in a shareholder group claim?
Usually under the funding and litigation management arrangements agreed at the outset, often backed by a single ATE policy for the group.
Who can bring a securities claim in the UK?
Investors who acquired or held securities in reliance on misleading published information may have claims, commonly brought as a group.
Is ATE available for investor group claims?
Yes, ATE is commonly arranged for the claimant group alongside third-party funding.
Can a listed company insure a securities claim against it?
Beyond D&O cover, a company may consider adverse judgment cover for a specific pending claim, subject to underwriting.
General information only. This page is not legal, financial, investment or insurance advice. Any insurance is subject to underwriting and to the terms of the policy wording issued.
Where to go next
Relevant cover
Other disputes
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