Stanford Law School's Securities Class Action Clearinghouse has counted 200 securities class-action lawsuits in 2008, up from 173 in 2007 and 115 in 2006, a rising trend that is blamed on the economy and weighed on insurers.
During the first half of 2008, 41 lawsuits were related to the subprime mortgage meltdown and 17 from the failure of the auction-rate securities market, Stanford and Cornerstone Research states. Jay Gelb, insurance industry analyst at Barclays Capital, said insurers that offer D&O coverage could end up covering some of the costs of these suits, with AIG, Lloyd's of London, Chubb, Travelers Cos. and Ace Ltd holding a majority interest in the D&O market.
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