The annual PLUS D&O Symposium in New York is a major crossing point for D&O teams from the US and Europe and, as a result, is a great place to gain insights into the shifting state of the global D&O insurance market. At this year’s event, over a thousand delegates gathered, primarily from the US but with significant attendance from the UK, Europe, Bermuda, Singapore and Australia.

Several key themes emerged at the event. Perhaps most critical was a general agreement internationally that D&O claims are increasing both in frequency and severity. That said, a negative claims picture has been expected for several years by insurers, and as a result we are, rather contrarily, emerging out of the hard market. Improved pricing has come about because of increased capacity and new entrants, who have scented the opportunity in this long-challenged space. This included higher take up in Bermuda where costs bases were lower.

The underwriters I talked to are interested to see how the predicted wave of claims relating to ESG will develop, and whether the increased interest rates and high inflation will lead to an uptick in the number of corporate insolvencies. These developments appear priced in, however, which should comfort both corporates and their underwriters as they watch developments.

The jangling nerves are much more to be felt around increased defence cost spend, with rates of spend reaching unprecedented levels in the US. This was coupled with the rising threat of litigation funders and legal charitable organisations providing capital for new types of claims, including greenwashing allegations against high-profile insureds in the financial and energy sectors. The ever-increasing regulatory burdens focusing on personal responsibility of directors and officers amplified by multi-agency and often multi-jurisdictional investigations were a source of increasing concern. It is here that corporate D&O buyers should be spending time exploring cover limits with their brokers, and is where we predict significant movement in the coming year.

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