At first blush the move by class action litigators Maurice Blackburn against troubled insurance group QBE looks like a reasonable prospect given the magnitude of the disclosure debacle last year.

The shock loss QBE announced in December 2013 must have registered a seven on the Richter scale. The market was expecting a profit of more than $1 billion and instead copped a $250 million loss.

Whether you take the view that class action litigators (or ambulance chasers, which they are often called) are an important part of the corporate ecosystem or leeches, they are increasingly holding companies to account when it comes to disclosure in Australia.

It is easy to understand shareholders' disappointment in QBE's performance and their amazement that the insurer's performance could have gone so pear-shaped without even a hint from the company.

While the size of the loss was enormous, it's fair to say that plenty of analysts have long disliked the stock and had issued cautions.

Under the previous management regime, there was a sizeable school of thought that the aggressive acquisition binge QBE had undertaken over many years was dangerous and that its performance was a ticking bomb.

The trouble is that companies can't be sued for poor judgment or management decisions.

The basis of the case is that QBE did not disclose the extent of its troubles when it knew about them.

QBE made its announcement on December 9, 2013, that the results for the year would be a massive $1.25 billion away from previous expectations - just three weeks before the end of its financial year - a peg on which Maurice Blackburn will hang a large part of its case.

It does prompt one to think that QBE senior management was sitting under a mushroom as it seems implausible that the company's fortunes changed so rapidly.

The other part of the class action case rests with the fact that most of the financial damage inside QBE was coming from part of its North American division - and the announcements from the company support this.

This division had been receiving intense management care during 2013, which suggests the management was aware of its problems.

This leads into whether the management should have made projections in August about performance metrics such as combined operating ratio which by the end of the year were clearly wide of the mark.

Again the company can't be sued for getting forecasts wrong but (under the law) it needs to have a reasonable basis for making them.

Once QBE made its December 9 announcement, the damaging effect on its share price is difficult to dispute. Within two days the shares had dropped by almost a third and chairman Belinda Hutchinson promptly resigned.

It was an ugly chapter in corporate history but not one that the regulator, the Australian Securities and Investments Commission, has publicly made mention of.

According to Maurice Blackburn, ''The vast majority of Australian companies are conscientious about their disclosure obligations. But to keep the market fair for those that do play by the rules, we all have an interest in penalising the ones that don't. Our class actions do that.''

That's a statement that would be more appropriate coming from the regulator, and while there are many that believe regulators and class action litigators work hand in hand, in many instances successful class actions show up the corporate watchdog's deficiencies.