Growing Number of Companies Increasing Directors and Officers Liability Limits
According to a Towers Watson Survey released last month, many companies have decided to increase the limits of their directors and officers liability insurance policies.
According to Towers Watson, the trend towards increasing policy limits can be attributed to an increased potential for litigation and a heightened concern over the threat of regulatory investigations. According to the survey, 21% of respondents indicated that they had increased their D&O limits as compared to their prior D&O policy. (In a 2008 survey, only 12% of respondents had reported an increase to their limits over the previous year.) A further 75% of respondents said that their limits had stayed the same (as compared to 86% in the 2008 survey). Only 3% of respondents said that they had decreased their limits.
Other survey highlights include:
• 54% of respondents said that they had not conducted an independent review of their D&O program within the past two years.
• 35% of private organizations bought excess Side A coverage.
• More than 80% of public company respondents purchased excess Side A coverage.
• 35% of non-profit and 22% of private company respondents said they were not sure how their D&O program was structured.
A copy of the press release issued by Towers Watson can be found at: http://www.businesswire.com/news/home/20110222006279/en/Growing-Number-Companies-Increasing-Directors-Officers-Liability