CASUALTY TYPES & BONDS · 6 MIN READ

Professional, Management, and Cyber Liability

Professional liability lines — Lawyers (LPL), Architects and Engineers (A&E), Accountants (APL), medical malpractice, and miscellaneous E&O — share a common structural DNA that the exam tests heavily. Nearly all are written claims-made-and-reported, meaning both the claim and the insured's notice to the carrier must land during the policy period; each policy carries a retroactive date fixing the earliest act that can trigger coverage; and most use defense-within-limits, where every defense dollar erodes the indemnity limit. These features respond to the long tail of malpractice claims, which often surface five to ten years after the act, with defense costs consuming the majority of total claim spend. Continuity between carriers is preserved two ways: the expiring carrier's Extended Reporting Period — a short automatic basic tail plus an optional supplemental tail purchased for additional premium — or prior-acts (nose) coverage, where the new carrier sets its retroactive date back to the start of continuous coverage. Management liability adds its own architecture. Directors and Officers policies are built as a tower: Side A covers individual directors and officers when the company cannot indemnify them, Side B reimburses the company for indemnification it pays, and Side C covers the entity itself for securities claims. A Side A DIC (difference-in-conditions) policy sits on top and drops down when underlying coverage fails. The insured-versus-insured exclusion bars suits between insureds, subject to carve-backs such as shareholder derivative actions. Employment Practices Liability (EPLI) covers discrimination, harassment, and wrongful termination, often extending to third-party harassment claims; wage-and-hour claims typically get only a defense-cost sublimit, because back wages owed under the FLSA are uninsurable restitution. Public Officials Liability E&O is the governmental analogue, covering wrongful acts of elected and appointed officials that the CGL cannot reach. Cyber liability policies split into first-party coverages — forensic investigation, breach notification, credit monitoring, data restoration, cyber extortion and ransom payments, and business income during network outage — and third-party coverages for claims others bring against the insured: privacy and network-security lawsuits, regulatory defense, media liability, and payment-card assessments. Because cyber is uniformly claims-made, the same tail and nose mechanics apply at every carrier transition.