Last week, we noted that News Corp’s D&O insurance was facing a “raft” of claims relating to the phone-hacking scandal. According to an article that appeared this past week in the Insurance Insider, several industry observers believe that News Corp’s entire $180 million D&O tower will be exhausted by the claims. Although the policies likely contain criminal or fraudulent act exclusions, the Insurance Insider’s sources apparently do not expect these to prevent the tower from getting wiped out. High-level News Corp management has denied any knowledge of the wrongdoing. But lawsuits have alleged that management was reckless in not knowing about the illegal activities, which have harmed the company’s stock price.
Of course, the D&O insurers will likely have their own view as to whether their policies cover these claims.