Whether consumer protection or false advertising claims are covered by insurance depends on the kind of insurance policies in play. For example, coverage for such claims under a CGL policy is unlikely because an insured's false representation or false advertising about the qualities of its products typically does not fall within any of the "offenses" enumerated under the "advertising injury" coverage grant. See Applied Bolting Tech Prods v. US Fid & Guar Co., 942 F Supp 1029 (ED Pa 1996), in which the court held that alleged false advertising that an insured's products conformed to certain industry standards did not constitute advertising injury in a lawsuit brought by another manufacturer of the same or similar product See also Law v. Golden Eagle Ins. Co., 99 Cal. App. 4th 109 (2022), which involved coverage for a consumer's uncertified class action arising from the sale of appetite suppressants and diet products.
The situation changes, however, if a D & O or management liability policy is involved. In such a policy, the existence of a "Wrongful Act" is the trigger for coverage. And importantly covered "Wrongful Acts" are not limited to negligent or unintentional conduct. Thus, "to contend...that the alleged wrongful acts are not covered under the policy because the claimants alleged knowing, intentional, and purposeful acts' that do not constitute `negligence, mistake or error' is misplaced, as the policy does not limit the definition of wrongful acts to acts...
Vadodara/Surat. A special CBI court has convicted four individuals in a 23-year-old fire insurance fraud case in Gujarat and sentenced each of them to three years of rigorous imprisonment. The cou...