With increased market investment directors and officers' (D&O) liability cover is becoming easier to access at more affordable terms, but all policies are not equal and it's a case of buyer beware.

There's more choice of insurers due to new entrants to the D&O market with no exposure to the development of prior notified legacy risk. These are providing welcome alternatives to current market offerings but lack of transparency of settlement sums and the number of unresolved claims call for closer scrutiny of insurer offerings, which may be subject to factors that are not immediately obvious.

In the H1 2022 edition of the Business Insurance and Risk Market update report our article reports that the D&O insurance market is subject to complex influences, including

  • variations in financial security and claims paying capacity
  • boards may not understand the magnitude of their risks
  • obtaining with strong terms at a reasonable price may require a combination of insurers
  • broker advice is critical to an accurate appraisal of offerings.

Further complications that may have a bearing for Australia-based businesses include overseas insurers that may not qualify to provide coverage locally; and the need for businesses retaining risks to quantify what this might mean.

Other topics include:

  • Placement — why making a case for cover to local insurers is important.
  • Claims — the impacts of weather events on supply chain delays and claims inflation.
  • Disability sector — the factors making insurance for this sector hard to find.
  • Environmental, social responsibility and governance (ESG) — with an increased focus on ethical business practice insurers are scrutinising accountability
  • Cyber security — how businesses need to meet the escalation of the risk environment
  • Regional Australia — why the regional construction sector is facing crisis.

Download the report to learn more

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