Cooling D&O Market, ESG Impacts, Fewer Securities Lawsuits but Higher Settlements
San Francisco, CA – September 20, 2022 – Woodruff Sawyer, one of the largest independent insurance brokerages in the US, announced today the release of the 2023 D&O Looking Ahead Guide. For the last 10 years the Guide has provided a trusted guide for clients to help them make sense of the current Directors and Officers liability insurance environment and to plan for their upcoming renewal.
In 2021 , Woodruff Sawyer’s Looking Ahead Guide correctly predicted D&O pricing would moderate as new capacity and new competition entered the market. In the first half of 2022, 69% of clients saw their premium decrease vs. 12% in 2021. Woodruff Sawyer predicts this will persist well into 2023.
A significant area of interest for public company directors and officers is the securities litigation landscape. While filings are down 7% year over year, settlement amounts are not. So far this year, 48 settlements have been reached totaling $1.4 billion, exceeding the 10-year average and median. Today, 476 cases, many of which have been open for several years, remain on the docket. The trend of longer-duration cases generating even larger settlements is an ongoing cause for concern for D&O underwriters.
While ESG or Environmental, Social and Governance issues have been a flashpoint for boards over the last few years, 2022 has proven particularly challenging. The SEC’s proposed climate rules will add an extra regulatory burden to companies just as the economy is going through a downturn. In addition, the Supreme Court’s June 2022 decision overturning Dobbs v. Jackson has created chaos in the world of employee benefits, not to mention potential personal liability threats for boards of directors. 2023 will likely bring some clarification but right now companies are making decisions that could place them at risk. For more insights into the impact of Dobbs liability on your company and board, read Woodruff Sawyer’s Post Roe: Dobbs v. Jackson FAQ.
Priya Huskins, Senior Vice President, Management Liability and editor of the “D&O Notebook” blog series notes, “2022 has been an impactful year – throwing former norms into disarray and creating uncertainty in the D&O market. We’re pleased about the softer D&O market but the societal and economic challenges ahead are daunting. Over the last 10 years, our D&O Looking Ahead Guide has provided a touchstone for clients and the curious alike , helping them make sense of their D&O environment and the challenges that impact them while guiding them to the next right move.”
Want to learn more? Sign up to attend Woodruff Sawyer’s 2023 D&O Looking Ahead Guide Webinar on September 28, 2022 from 10 AM-11 AM PDT.
About Woodruff Sawyer
As one of the largest insurance brokerage and consulting firms in the US, Woodruff Sawyer protects the people and assets of more than 4,000 companies. We provide expert counsel and fierce advocacy to protect clients against their most critical risks in property and casualty, management liability, cyber liability, employee benefits, and personal wealth management. An active partner of Assurex Global and International Benefits Network, we provide expertise and customized solutions where clients need it, with headquarters in San Francisco, offices throughout the US, and global reach on six continents. For more information, call 844.972.6326, or visit woodruffsawyer.com.