In Partnership with
From a pandemic recovery to market withdrawals - what's going on with management liability?
Three management liability insurance experts give their take on how the market has changed, and their top tips for brokers on navigating an influx of new capacity
John Moller
Arch Insurance
Industry experts
Brock McKechnie
CNA Canada
Cody Macpherson
KASE Insurance
John Moller serves as senior vice president, specialty lines for Arch Insurance Canada. Moller joined Arch in New York City in 2009 and relocated to Toronto in 2018. He is currently the national head of executive assurance, professional liability, and P&C programs for Arch’s Canadian company. Prior to this, Moller was VP of growth and middle market, managing the underwriting of SME risks in the US. He’s also held positions of various levels of responsibility at Hartford Financial Products. Moller has a bachelor’s degree in finance from the University of Delaware in Newark, Delaware.
Senior vice president, specialty lines
Arch Insurance
John Moller
Brock McKechnie is currently an underwriting manager within CNA Canada’s management liability and financial institutions group. Based in Calgary, McKechnie looks after the Western Canadian region while also providing leadership nationally on public company directors’ and officers’ liability. With over a decade of experience in the Canadian commercial insurance market, McKechnie has experience both on the brokerage side and in underwriting and has seen many market cycles and economic downturns, which has helped him become a leading professional in the space.
Underwriting manager
CNA Canada
Brock McKechnie
Cody Macpherson is an account executive at KASE Insurance. Having started his career in 2018, Macpherson specializes in commercial insurance, working with many companies in construction and bonding, tech and media, professional services, and manufacturing. Macpherson works with clients big and small, ranging from the start-up phase to companies with revenues in excess of $70 million. Macpherson is always focused on making sure his clients have the proper coverages and are educated on what products are available to them.
Account executive
KASE Insurance
Cody Macpherson
“What's changed is that better pricing ... has drawn capacity back in, spurring more competition"
John Moller,
Arch Insurance
THE WORD “UNPRECEDENTED” has a habit of being wheeled out in precedented circumstances – but experts at Insurance Business Canada’s management liability round table were insistent that it truly does apply to what the market has faced over the past two to three years.
In this edition of IB’s 2022 Executive Insights series, a panel of management liability experts dug into the changing financial and professional lines landscape and offered top tips for brokers.
“We've seen an improved marketplace for clients who adapted through the pandemic and managed the issues presented to them”
Brock McKechnie, CNA Canada
Claims and mitigation
An emphasis on preparedness has become “a focal point for clients,” said McKechnie.
Key focus areas include whether they have the financial reserves to handle another event of this nature, as well as how they are managing and engaging with employees and how HR is managing and maintaining talent levels.
“The event-driven claims didn't manifest in the way they were anticipated the past couple years, but this does not mean the return to normalcy will not result in anticipated D&O type activity,” McKechnie said.
“It's important to realize ... exactly what the client is looking for, and how the deal can be done to best protect the client”
Cody Macpherson, KASE Insurance
materialize, and says that “it’s also a little bit notable that that those that did have had trouble surviving motions to dismiss.”
“It's been a more favorable claims environment in some areas, such as D&O, than we thought – and then you see the opposite in some other areas that have been affected, like EPL, [with] frequency and severity going up in that area,” Moller said.
As courts and plaintiffs’ firms return to a more normal work environment, Moller says the market is seeing a “return to normalcy” in terms of frequency after a lull in some areas. The types of claims Arch is currently seeing are “classic D&O claims” such as on financial matters, adequacy of disclosures, and mergers and acquisitions-related matters, Moller said.
“We’re in an improved place,” according to Macpherson.
“The hard market plus COVID have really made everyone run a very tight ship in order to comply with not only insurance, but also the new COVID regulations,” Macpherson said.
“Coming out of that, I think those new policies and procedures and practices are going to stay in place and do a lot for the future.”
“The last thing you want to do is to have to replace markets every year that are in or out, or being aggressive and then pulling back, because their profitability measures are swinging,” Moller cautioned.
Expertise and service should be top priorities when choosing the right underwriter, said McKechnie.
“Brokers require claims teams with experience in tough litigation environments, underwriters with experience through different cycles, who understand what clients have been going through and what they will encounter going forward,” said McKechnie.
Insureds’ most important D&O coverage issues
Market overview
Pre-pandemic, D&O had been operating in a soft market for around 10 years, leading to a lot of business being underpriced, according to John Moller, senior vice president, specialty lines, Arch Insurance.
“The pandemic really exacerbated the withdrawal of capacity, which had already begun, and also caused a sharp increase in rates as underwriters took a harder look at the portfolios and their exposure,” said Moller.
COVID-related fears, including government shutdowns and concerns around event-driven litigation liquidity events, drove profitability fears among insurers, according to Moller, and led to “supply shocks” of exiting capacity.
However, the outlook has been looking rosier into the second quarter of this year and beyond, according to the Arch SVP.
“What's changed is that better pricing, that adequate pricing, has drawn capacity back in, spurring more competition and leading to some softening that we're seeing now,” said Moller.
Many claims events that insurers were concerned could follow the pandemic did not transpire, said CNA Canada underwriting manager Brock McKechnie.
According to McKechnie, industries such as mining and energy experienced a decrease in demand throughout the pandemic.
Softening rates?
Rates are beginning to level out following an “unprecedented” COVID surge, said Macpherson.
“We are seeing that return to normalcy also affect the pricing side of it and getting competitive policies,” he noted.
Moller agreed. “The rates changed so quickly, it was a little bit unusual for a hard market cycle – even an event-driven one – to compound so quickly and accelerate so fast, that it's only natural that we see some stability, and some softening in certain pockets.
“We're definitely seeing a reversal of the trend in the last two years.”
Looking at some of the more difficult risk classes, McKechnie said, “In terms of funding options for primary and lower layers, we continue to see rate and correction on terms of conditions.”
The addition of new layers and capacity will help in terms of access, according to McKechnie, but “we are expecting it to continue on larger and tougher risk classes.”
“It was a unique mix of claims inventory and pandemic uncertainty that contributed to the changes in rates, so there's an element of just a bit of correction back down in pricing this year,” McKechnie explained.
“We've seen an improved marketplace for clients who adapted through the pandemic and managed the issues presented to them,” he added.
D&O cover was one of the more popular products during the pandemic, said KASE Insurance account executive Cody Macpherson.
“We are seeing more people who maybe couldn't get it before, or it was out of their price range, wanting to enter the market now,” Macpherson said.
“These are much more stable rates, they're more favorable coverages that are coming through, and they're saying ‘Okay, perfect, now is a good time to re-enter the market,’ on the dormant capacity side from the insurers, but also on the client side.”
Cyber is likely to continue to be a “focal point,” he added.
Employment practices liability (EPL) insurance has been a focus area, according to McKechnie.
“Larger dismissal programs have resulted in claims activity,” McKechnie said. “However, we've also seen terminations – because of failure to comply with potential vaccine mandates and failure to come into work because of responsibilities at home – that have become a challenge due to the pandemic.”
Moller agreed that most COVID-driven litigation failed to
Read on
Price and expertise
Moller advises that brokers should be wary of placing business purely from a price perspective.
“Nobody likes paying more for anything than they need to – but unfortunately, I think pure pricing probably does drive more deals than it should,” said Moller.
“In such a technical line, it's really important that accounts are being placed by brokers who are specialists and with markets that are sophisticated.”
“A lot of new capacity has shown up at the table in the last six months or a year to exploit this higher pricing,” Moller said. “And many of these markets won't be in the market in three years.”
Top tips
All three experts agreed that communication is key for brokers navigating the market.
“Get involved in the industry and know who's writing what; the last thing you want to do is spend time and resources – not only your own but the insured’s – getting to know a market and placing a line of business with someone who doesn't really specialize in that,” said Macpherson.
McKechnie echoed this. “It's important for communication to happen regularly. Transparency is vital.”
Moller asserted, "If there's a particular unique exposure or story to an account, the best way to get attention for your particular placement is to just make a phone call.”
Arch Insurance North America is part of a global insurer offering superior coverage and service. We participate in specialty lines where the talent and knowledge of our employees are a competitive differentiator. We serve North America from offices in the United States and Canada, providing superb coverage and claims handling through careful and diligent underwriting of risks and business-friendly solutions. With 20 years of operating history and strong financial ratings, our track record remains solid.
Find out more
CNA is one of the largest US commercial property and casualty insurance companies. Backed by more than 120 years of experience, CNA provides a broad range of standard and specialized insurance products and services for businesses and professionals in the US, Canada, and Europe.
In Canada, products and services are provided by Continental Casualty Company, a leading specialist commercial property and casualty insurance provider for clients and brokers in all local geographies, backed by more than 100 years of experience.
Find out more
KASE Insurance is an award-winning specialty commercial insurance brokerage in Toronto, Canada, and the reputable partner of choice for clients ranging from a sole trader or small professional firm to manufacturers and contractors with revenues in excess of $50 million. We cover all your needs, including commercial general liability, surety & bonding, group benefits, and corporate financial services. We work with everyone from newly formed enterprises to publicly listed companies, and our experience crosses many industries, including construction & bonding, tech & media, professional services, and manufacturing.
Find out more
“What's changed is that better pricing ... has drawn capacity back in, spurring more competition"
JOHN MOLLER,
ARCH INSURANCE
“It's important to realize ... exactly what the client is looking for, and how the deal can be done to best protect the client”
CODY MACPHERSON,
KASE INSURANCE
“We've seen an improved marketplace for clients who adapted through the pandemic and managed the issues presented to them”
BROCK MCKECHNIE,
CNA CANADA
In Partnership with
From a pandemic recovery to market withdrawals - what's going on with management liability?
Three management liability insurance experts give their take on how the market has changed, and their top tips for brokers on navigating an influx of new capacity
Read on
Cody Macpherson
KASE Insurance
Brock McKechnie
CNA Canada
John Moller
Arch Insurance
Industry experts
THE WORD "UNPRECEDENTED" has a habit of being wheeled out in precedented circumstances – but experts at Insurance Business Canada’s management liability round table were insistent that it truly does apply to what the market has faced over the past two to three years.
In this edition of IB’s 2022 Executive Insights series, a panel of management liability experts dug into the changing financial and professional lines landscape and offered top tips for brokers.
“It was a unique mix of claims inventory and pandemic uncertainty that contributed to the changes in rates, so there's an element of just a bit of correction back down in pricing this year,” McKechnie explained.
“We've seen an improved marketplace for clients who adapted through the pandemic and managed the issues presented to them,” he added.
D&O cover was one of the more popular products during the pandemic, said KASE Insurance account executive Cody Macpherson.
“We are seeing more people who maybe couldn't get it before, or it was out of their price range, wanting to enter the market now,” Macpherson said.
“These are much more stable rates, they're more favorable coverages that are coming through, and they're saying ‘Okay, perfect, now is a good time to re-enter the market,’ on the dormant capacity side from the insurers, but also on the client side.”
Market overview
Pre-pandemic, D&O had been operating in a soft market for around 10 years, leading to a lot of business being underpriced, according to John Moller, senior vice president, specialty lines, Arch Insurance.
“The pandemic really exacerbated the withdrawal of capacity, which had already begun, and also caused a sharp increase in rates as underwriters took a harder look at the portfolios and their exposure,” said Moller.
COVID-related fears, including government shutdowns and concerns around event-driven litigation liquidity events, drove profitability fears among insurers, according to Moller, and led to “supply shocks” of exiting capacity.
However, the outlook has been looking rosier into the second quarter of this year and beyond, according to the Arch SVP.
“What's changed is that better pricing, that adequate pricing, has drawn capacity back in, spurring more competition and leading to some softening that we're seeing now,” said Moller.
Many claims events that insurers were concerned could follow the pandemic did not transpire, said CNA Canada underwriting manager Brock McKechnie.
According to McKechnie, industries such as mining and energy experienced a decrease in demand throughout the pandemic.
Claims and mitigation
An emphasis on preparedness has become “a focal point for clients,” said McKechnie.
Key focus areas include whether they have the financial reserves to handle another event of this nature, as well as how they are managing and engaging with employees and how HR is managing and maintaining talent levels.
“The event-driven claims didn't manifest in the way they were anticipated the past couple years, but this does not mean the return to normalcy will not result in anticipated D&O type activity,” McKechnie said.
Cyber is likely to continue to be a “focal point,” he added.
Employment practices liability (EPL) insurance has been a focus area, according to McKechnie.
“Larger dismissal programs have resulted in claims activity,” McKechnie said. “However, we've also seen terminations – because of failure to comply with potential vaccine mandates and failure to come into work because of responsibilities at home – that have become a challenge due to the pandemic.”
Moller agreed that most COVID-driven litigation failed to
materialize, and says that “it’s also a little bit notable that that those that did have had trouble surviving motions to dismiss.”
“It's been a more favorable claims environment in some areas, such as D&O, than we thought – and then you see the opposite in some other areas that have been affected, like EPL, [with] frequency and severity going up in that area,” Moller said.
As courts and plaintiffs’ firms return to a more normal work environment, Moller says the market is seeing a “return to normalcy” in terms of frequency after a lull in some areas. The types of claims Arch is currently seeing are “classic D&O claims” such as on financial matters, adequacy of disclosures, and mergers and acquisitions-related matters, Moller said.
“We’re in an improved place,” according to Macpherson.
“The hard market plus COVID have really made everyone run a very tight ship in order to comply with not only insurance, but also the new COVID regulations,” Macpherson said.
“Coming out of that, I think those new policies and procedures and practices are going to stay in place and do a lot for the future.”
Softening rates?
Rates are beginning to level out following an “unprecedented” COVID surge, said Macpherson.
“We are seeing that return to normalcy also affect the pricing side of it and getting competitive policies,” he noted.
Moller agreed. “The rates changed so quickly, it was a little bit unusual for a hard market cycle – even an event-driven one – to compound so quickly and accelerate so fast, that it's only natural that we see some stability, and some softening in certain pockets.
“We're definitely seeing a reversal of the trend in the last two years.”
Looking at some of the more difficult risk classes, McKechnie said, “In terms of funding options for primary and lower layers, we continue to see rate and correction on terms of conditions.”
The addition of new layers and capacity will help in terms of access, according to McKechnie, but “we are expecting it to continue on larger and tougher risk classes.”
Price and expertise
Moller advises that brokers should be wary of placing business purely from a price perspective.
“Nobody likes paying more for anything than they need to – but unfortunately, I think pure pricing probably does drive more deals than it should,” said Moller.
“In such a technical line, it's really important that accounts are being placed by brokers who are specialists and with markets that are sophisticated.”
“A lot of new capacity has shown up at the table in the last six months or a year to exploit this higher pricing,” Moller said. “And many of these markets won't be in the market in three years.”
“The last thing you want to do is to have to replace markets every year that are in or out, or being aggressive and then pulling back, because their profitability measures are swinging,” Moller cautioned.
Expertise and service should be top priorities when choosing the right underwriter, said McKechnie.
“Brokers require claims teams with experience in tough litigation environments, underwriters with experience through different cycles, who understand what clients have been going through and what they will encounter going forward,” said McKechnie.
“It's important to realize on the broker side and on the insurer side exactly what the client is looking for, and how the deal can be done to best protect the client,” added Macpherson.
He highlighted inflation and rising interest rates, pointing to recent media reports that said that S&P is now in a bear market, meaning it is seeing prolonged pricing declines.
“All of these things are going to have changes over the coming year in regard to cover wordings and claim examples,” said Macpherson
“As that changes, price is important, but the coverage and [an experienced claims response] are super important.”
John Moller serves as senior vice president, specialty lines for Arch Insurance Canada. Moller joined Arch in New York City in 2009 and relocated to Toronto in 2018. He is currently the national head of executive assurance, professional liability, and P&C programs for Arch’s Canadian company. Prior to this, Moller was VP of growth and middle market, managing the underwriting of SME risks in the US. He’s also held positions of various levels of responsibility at Hartford Financial Products. Moller has a bachelor’s degree in finance from the University of Delaware in Newark, Delaware.
Senior vice president, specialty lines,
Arch Insurance
John Moller
Brock McKechnie is currently an underwriting manager within CNA Canada’s management liability and financial institutions group. Based in Calgary, McKechnie looks after the Western Canadian region while also providing leadership nationally on public company directors’ and officers’ liability. With over a decade of experience in the Canadian commercial insurance market, McKechnie has experience both on the brokerage side and in underwriting and has seen many market cycles and economic downturns, which has helped him become a leading professional in the space.
Underwriting manager
CNA Canada
Brock McKechnie
Cody Macpherson is an account executive at KASE Insurance. Having started his career in 2018, Macpherson specializes in commercial insurance, working with many companies in construction and bonding, tech and media, professional services, and manufacturing. Macpherson works with clients big and small, ranging from the start-up phase to companies with revenues in excess of $70 million. Macpherson is always focused on making sure his clients have the proper coverages and are educated on what products are available to them.
Account executive
KASE Insurance
Cody Macpherson
In Partnership with
From a pandemic recovery to market withdrawals - what's going on with management liability?
Three management liability insurance experts give their take on how the market has changed, and their top tips for brokers on navigating an influx of new capacity
Read on
Cody Macpherson
KASE Insurance
Brock McKechnie
CNA Canada
John Moller
Arch Insurance
Industry experts
THE WORD "UNPRECEDENTED" has a habit of being wheeled out in precedented circumstances – but experts at Insurance Business Canada’s management liability round table were insistent that it truly does apply to what the market has faced over the past two to three years.
In this edition of IB’s 2022 Executive Insights series, a panel of management liability experts dug into the changing financial and professional lines landscape and offered top tips for brokers.
“It was a unique mix of claims inventory and pandemic uncertainty that contributed to the changes in rates, so there's an element of just a bit of correction back down in pricing this year,” McKechnie explained.
“We've seen an improved marketplace for clients who adapted through the pandemic and managed the issues presented to them,” he added.
D&O cover was one of the more popular products during the pandemic, said KASE Insurance account executive Cody Macpherson.
“We are seeing more people who maybe couldn't get it before, or it was out of their price range, wanting to enter the market now,” Macpherson said.
“These are much more stable rates, they're more favorable coverages that are coming through, and they're saying ‘Okay, perfect, now is a good time to re-enter the market,’ on the dormant capacity side from the insurers, but also on the client side.”
Market overview
Pre-pandemic, D&O had been operating in a soft market for around 10 years, leading to a lot of business being underpriced, according to John Moller, senior vice president, specialty lines, Arch Insurance.
“The pandemic really exacerbated the withdrawal of capacity, which had already begun, and also caused a sharp increase in rates as underwriters took a harder look at the portfolios and their exposure,” said Moller.
COVID-related fears, including government shutdowns and concerns around event-driven litigation liquidity events, drove profitability fears among insurers, according to Moller, and led to “supply shocks” of exiting capacity.
However, the outlook has been looking rosier into the second quarter of this year and beyond, according to the Arch SVP.
“What's changed is that better pricing, that adequate pricing, has drawn capacity back in, spurring more competition and leading to some softening that we're seeing now,” said Moller.
Many claims events that insurers were concerned could follow the pandemic did not transpire, said CNA Canada underwriting manager Brock McKechnie.
According to McKechnie, industries such as mining and energy experienced a decrease in demand throughout the pandemic.
Claims and mitigation
An emphasis on preparedness has become “a focal point for clients,” said McKechnie.
Key focus areas include whether they have the financial reserves to handle another event of this nature, as well as how they are managing and engaging with employees and how HR is managing and maintaining talent levels.
“The event-driven claims didn't manifest in the way they were anticipated the past couple years, but this does not mean the return to normalcy will not result in anticipated D&O type activity,” McKechnie said.
Cyber is likely to continue to be a “focal point,” he added.
Employment practices liability (EPL) insurance has been a focus area, according to McKechnie.
“Larger dismissal programs have resulted in claims activity,” McKechnie said. “However, we've also seen terminations – because of failure to comply with potential vaccine mandates and failure to come into work because of responsibilities at home – that have become a challenge due to the pandemic.”
Moller agreed that most COVID-driven litigation failed to
materialize, and says that “it’s also a little bit notable that that those that did have had trouble surviving motions to dismiss.”
“It's been a more favorable claims environment in some areas, such as D&O, than we thought – and then you see the opposite in some other areas that have been affected, like EPL, [with] frequency and severity going up in that area,” Moller said.
As courts and plaintiffs’ firms return to a more normal work environment, Moller says the market is seeing a “return to normalcy” in terms of frequency after a lull in some areas. The types of claims Arch is currently seeing are “classic D&O claims” such as on financial matters, adequacy of disclosures, and mergers and acquisitions-related matters, Moller said.
“We’re in an improved place,” according to Macpherson.
“The hard market plus COVID have really made everyone run a very tight ship in order to comply with not only insurance, but also the new COVID regulations,” Macpherson said.
“Coming out of that, I think those new policies and procedures and practices are going to stay in place and do a lot for the future.”
Softening rates?
Rates are beginning to level out following an “unprecedented” COVID surge, said Macpherson.
“We are seeing that return to normalcy also affect the pricing side of it and getting competitive policies,” he noted.
Moller agreed. “The rates changed so quickly, it was a little bit unusual for a hard market cycle – even an event-driven one – to compound so quickly and accelerate so fast, that it's only natural that we see some stability, and some softening in certain pockets.
“We're definitely seeing a reversal of the trend in the last two years.”
Looking at some of the more difficult risk classes, McKechnie said, “In terms of funding options for primary and lower layers, we continue to see rate and correction on terms of conditions.”
The addition of new layers and capacity will help in terms of access, according to McKechnie, but “we are expecting it to continue on larger and tougher risk classes.”
Price and expertise
Moller advises that brokers should be wary of placing business purely from a price perspective.
“Nobody likes paying more for anything than they need to – but unfortunately, I think pure pricing probably does drive more deals than it should,” said Moller.
“In such a technical line, it's really important that accounts are being placed by brokers who are specialists and with markets that are sophisticated.”
“A lot of new capacity has shown up at the table in the last six months or a year to exploit this higher pricing,” Moller said. “And many of these markets won't be in the market in three years.”
“The last thing you want to do is to have to replace markets every year that are in or out, or being aggressive and then pulling back, because their profitability measures are swinging,” Moller cautioned.
Expertise and service should be top priorities when choosing the right underwriter, said McKechnie.
“Brokers require claims teams with experience in tough litigation environments, underwriters with experience through different cycles, who understand what clients have been going through and what they will encounter going forward,” said McKechnie.
“It's important to realize on the broker side and on the insurer side exactly what the client is looking for, and how the deal can be done to best protect the client,” added Macpherson.
He highlighted inflation and rising interest rates, pointing to recent media reports that said that S&P is now in a bear market, meaning it is seeing prolonged pricing declines.
“All of these things are going to have changes over the coming year in regard to cover wordings and claim examples,” said Macpherson
“As that changes, price is important, but the coverage and [an experienced claims response] are super important.”
Cody Macpherson is an account executive at KASE Insurance. Having started his career in 2018, Macpherson specializes in commercial insurance, working with many companies in construction and bonding, tech and media, professional services, and manufacturing. Macpherson works with clients big and small, ranging from the start-up phase to companies with revenues in excess of $70 million. Macpherson is always focused on making sure his clients have the proper coverages and are educated on what products are available to them.
Account executive, KASE Insurance
Cody Macpherson
Brock McKechnie is currently an underwriting manager within CNA Canada’s management liability and financial institutions group. Based in Calgary, McKechnie looks after the Western Canadian region while also providing leadership nationally on public company directors’ and officers’ liability. With over a decade of experience in the Canadian commercial insurance market, McKechnie has experience both on the brokerage side and in underwriting and has seen many market cycles and economic downturns, which has helped him become a leading professional in the space.
Underwriting manager, CNA Canada
Brock McKechnie
John Moller serves as senior vice president, specialty lines for Arch Insurance Canada. Moller joined Arch in New York City in 2009 and relocated to Toronto in 2018. He is currently the national head of executive assurance, professional liability, and P&C programs for Arch’s Canadian company. Prior to this, Moller was VP of growth and middle market, managing the underwriting of SME risks in the US. He’s also held positions of various levels of responsibility at Hartford Financial Products. Moller has a bachelor’s degree in finance from the University of Delaware in Newark, Delaware.
Senior vice president, specialty lines, Arch Insurance
John Moller
Share
Share
Share
CONTACT US
EXPERT ADVICE
SPECIALTY
BEST INSURANCE
RESOURCES
RISK MANAGEMENT
LIFE
NEWS
Copyright © 2022 Key Media
Key Media
Insurance Business America
Insurance Business Australia
Wealth Professional Canada
People
Terms & conditions
Privacy policy
Conditions of use
About us
Contact us
RSS
Asia
NZ
AU
CA
US
UK
contact us
expert advice
specialty
Best Insurance
Resources
RISK MANAGEMENT
life
News
Copyright © 2022 Key Media
People
Terms & conditions
Privacy policy
Conditions of use
About us
Contact us
RSS
Asia
NZ
AU
CA
US
UK
contact us
expert advice
specialty
Best Insurance
Resources
RISK MANAGEMENT
life
News
Copyright © 2022 Key Media
People
Terms & conditions
Privacy policy
Conditions of use
About us
Contact us
RSS
Asia
NZ
AU
CA
US
UK
How claims against the directors and officers will be controlled and settled
67%
A choice of lawyer/counsel
Whether your D&O policy and/or company/organisation indemnification will be able to respond to claims in ALL jurisdictions
77%
Whether there is cover for fines and penalties
62%
56%
41%
59%
44%
56%
38%
35%
Whether there is cover for cost of legal advice at the early stages of an investigation
Understanding how coverage disputes among you, your company/organisation and your insurers will be dealt with
How the cover responds in the event of conflict of interest or claim between a director and the company/organisation
A broad definition of who is insured, including most categories of employees
The extent to which clawback provisions apply to the policy
Whether there is coverage to appoint a public relations expert to manage reputation risk in the event of a claim
Source: WTW and Clyde & Co Directors’ Liability Survey 2022
Source: WTW and Clyde & Co Directors’ Liability Survey 2022
Top five risks to directors
Cyber attack
Data loss
Cyber extortion
Regulatory risk (including threat of fines and penalties)
Risk of a health and safety / environmental prosecutions safety legislation
“It's important to realize on the broker side and on the insurer side exactly what the client is looking for, and how the deal can be done to best protect the client,” added Macpherson.
He highlighted inflation and rising interest rates, pointing to recent media reports that said that S&P is now in a bear market, meaning it is seeing prolonged pricing declines.
“All of these things are going to have changes over the coming year in regard to cover wordings and claim examples,” said Macpherson
“As that changes, price is important, but the coverage and [an experienced claims response] are super important.”
Risk ranking has increased for D&Os
Risk ranking has decreased for D&Os
Risk ranking has remained the same for D&Os
Top tips
All three experts agreed that communication is key for brokers navigating the market.
“Get involved in the industry and know who's writing what; the last thing you want to do is spend time and resources – not only your own but the insured’s – getting to know a market and placing a line of business with someone who doesn't really specialize in that,” said Macpherson.
McKechnie echoed this. “It's important for communication to happen regularly. Transparency is vital.”
Moller asserted, "If there's a particular unique exposure or story to an account, the best way to get attention for your particular placement is to just make a phone call.”
Top tips
All three experts agreed that communication is key for brokers navigating the market.
“Get involved in the industry and know who's writing what; the last thing you want to do is spend time and resources – not only your own but the insured’s – getting to know a market and placing a line of business with someone who doesn't really specialize in that,” said Macpherson.
McKechnie echoed this. “It's important for communication to happen regularly. Transparency is vital.”
Moller asserted, "If there's a particular unique exposure or story to an account, the best way to get attention for your particular placement is to just make a phone call.”