August 2017
 

Policy Concerning Attorneys' Conflicts of Interest and Business Conflicts

Introduction
On occasion an attorney who is representing or has represented CNA and/or a CNA insured is asked to represent a party that is adverse to CNA or a CNA insured. The Policy stated herein sets forth guidelines to assist both the attorney who is confronted with such a situation and the CNA employee to whom an inquiry is made concerning such a situation. Nothing in this Policy is intended to circumvent any State ethical canons concerning conflicts of interest.

Philosophy
CNA's concern is protection of its and its affiliated underwriting companies' confidential and privileged information. Accordingly, CNA will evaluate each conflict situation individually. There are two types of conflicts: ethical and business.

CNA seeks to minimize and avoid situations where confidential information may pass from counsel to an entity that is adverse to CNA. Prior to accepting an engagement to represent an entity, counsel has an ethical obligation to advise CNA of any situation in which confidential information may pass from counsel to an entity that is adverse to CNA. Generally, CNA will attempt to work with counsel to determine if the firm possesses confidential information and whether there is a way to create safeguards to protect CNA so that waiver of the conflict may be considered.

In addition, CNA is concerned about business conflicts. A business conflict arises when a firm providing legal services to CNA knowingly pursues actions against CNA insureds. Recognizing that the definition of business conflict encompasses a broad category of situations, it is the position of CNA that an attorney should not knowingly pursue actions on behalf of persons or entities that are adverse to interests that are insured by CNA.

CNA is contacted daily by excellent firms seeking to provide legal services. You and your firm should be cognizant of the fact that CNA has expended a great deal of time and energy in establishing a relationshipwith your firm. In view of the fact that CNA is sending business to your firm in lieu of other firms, you should recognize that CNA does not look favorably upon its defense counsel pursuing actions that are adverse to CNA's financial interests. If an attorney does work for CNA, CNA believes the attorney should not pursue actions against CNA insureds on behalf of plaintiffs. Such a situation constitutes a "business conflict," and may constitute a conflict of interest, depending on the circumstances.

Recommended Procedure
In those instances where a potential conflict of interest or business conflict exists, the following procedures should be followed by the attorney and the CNA employee who is informed of such a situation:

1. Counsel should review the CNA Entity List below to determine whether any of the entities identified there is or will be involved in the matter in question.  Counsel should note that CNA could be directly involved as a party or indirectly involved as an insurer of the party that Counsel is being asked to pursue or to advise about.  CNA expects Counsel to conduct an appropriate investigation in either case.

    

   CNA Entity List

    

   CNA's core wholly-owned U.S. property and casualty underwriting companies are:

    
   • • American Casualty Company of Reading, Pennsylvania
     • CNA Insurance Company Limited
     • Columbia Casualty Company (surplus lines carrier)
     • Continental Casualty Company
     • Continental Reinsurance Corporation International Limited
     • North Rock Insurance Company Limited
     • The Continental Insurance Company
     • The Continental Insurance Company of New Jersey
     • National Fire Insurance Company of Hartford
     • Surety Bonding Company of America
     • Transportation Insurance Company
     • Universal Surety of America
     • Valley Forge Insurance Company
     • Western Surety Company

    

   NOTE: Please include in any conflicts check any entity whose name contains the letters "CNA" or the word "Hardy."
   
   Effective December 31, 2006, the following twelve underwriting companies were merged, either directly or indirectly, with and into The Continental Insurance Company (CIC), which succeeds to all their rights, assets, debts and liabilities: Boston Old Colony Insurance Company; The Buckeye Union Insurance Company; Commercial Insurance Company of Newark, New Jersey; Continental Reinsurance Corporation; The Fidelity and Casualty Company of New York; Firemen's Insurance Company of Newark, New Jersey; The Glens Falls Insurance Company; Kansas City Fire and Marine Insurance Company; The Mayflower Insurance Company, Ltd.; National-Ben Franklin Insurance Company of Illinois; Niagara Fire Insurance Company; and Pacific Insurance Company. One underwriting company, CNA Casualty of California, has merged directly with and into Continental Casualty Company (CCC), which succeeds to all its rights, assets, debts and liabilities.
   
   The majority of the thirteen merged underwriting companies were primarily used to write personal lines business, which CNA sold in 1999. As a result, those underwriting companies were no longer being fully utilized to write CNA's core insurance business and were redundant for CNA's business needs. These mergers serve to remove unnecessary complexity in CNA's company structure. As a result of these mergers, the thirteen merged underwriting companies no longer legally exist.
   
   Effective December 31, 2007, Transcontinental Insurance Company was merged into National Fire Insurance Company of Hartford.
   
   All applicable regulatory approvals were obtained to effect these mergers.

    
2. An ethical conflict of interest exists if the representation of a client will be directly adverse to CNA or if there is a significant risk that the representation of one or more clients will be materially limited by the lawyer's responsibilities to CNA. A business conflict exists if the representation of a client will not be directly adverse to CNA, but will be adverse to CNA's interests or the interests of a CNA insured. 
3. An attorney who is considering undertaking the representation of a party that is adverse to either CNA or any of its affiliated underwriting companies or adverse to a CNA insured should inform CNA's Legal Services Groupof the situation in writing. The Legal Services Groupwill consider the relevant facts and make a decision as to whether a conflict of interest exists and, if so, whether to waive the conflict. CNA will consider each such situation on a case-by-case basis in order to make an appropriate decision given the particular facts and circumstances. In some instances the conflict of interest may be waived with the proviso that certain precautions will be taken by the attorney's law firm in order to protect CNA's interests. In other instances a conflict of interest may not exist, but a business conflict may exist. If a business conflict exists, CNA may wish to take action based upon that business conflict, if the firm chooses to undertake representation of the party whose interests are adverse to those of CNA. CNA will consider each such situation on a case-by-case basis in order to make an appropriate decision given the particular facts and circumstances. 
4. To assure the continuation of a strong working relationshipbetween CNA and its counsel, an attorney who is considering undertaking the representation of a party that is adverse to an interest that CNA may insure should contact the Legal Services Groupto inform them of this situation. If a business conflict may exist, the Legal Services Groupwill ask that a request for a waiver be submitted in writing. CNA will consider each such situation on a case-by-case basis, in order to make an appropriate decision, given the particular facts and circumstances. 
5. If an attorney discovers that he or she is representing a party who is adverse to a CNA insured, CNA requests that the firm advise the Legal Services Groupof this situation, in writing. CNA will contact the firm if further information is needed in order to determine whether an ethical or business conflict exists. 
6. Upon completion of a review of the facts, Legal Services will inform the attorney of the decision that has been made, in writing, and will provide a copy of this written decision to the business units affected by the decision. If a decision has been made to waive a conflict of interest subject to the utilization of ethical walls or other protective devices, these conditions will be stated in the letter. The attorney should then inform the Legal Services representative, in writing, whether these conditions are acceptable to the firm and confirm that the firm will take the actions required to protect the interests and confidences of CNA. 
7. If a conflict of interest or a business conflict arises during the course of litigation, rather than at the outset, the procedures set forth above should be utilized by the attorney in the same manner as if the conflict had arisen and been identified at the outset of the litigation.  

Frequently Asked Questions