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Directors and Officers Market Update

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Financial, Executive and Professional Risks (FINEX)

By Angus Duncan and Eve Richards | March 2, 2021

This market update provides several analyses of the current hard market and the impact this has on directors and officers.

GB D&O Overview

The hard market continues

  • During 2020, the London D&O market underwent a huge period of turmoil, with rates increasing at an unprecedented pace and insurers dramatically reducing their line sizes.
  • In addition to capacity reductions resulting from changes in insurer appetite, 2019 had already seen a number of insurers exit the D&O market. This continued in 2020, with both AXA XL and Argo exiting the D&O market in Q3.
  • The outlook for 2021 is better than 2020.
  • While we continue to anticipate rate increases, for many clients we would expect rate increases to be at a more moderate level than we saw in 2020, particularly for clients renewing in Q2 or later who have already been through a renewal in the height of the hard market in 2020.
  • Clients who currently have AXA XL as an incumbent insurer will face challenges in replacing them but, particularly for excess layers, there are a lot of new entrants into the market who may be able to assist.
  • Nonetheless, total capacity in the market seems likely to remain constrained and clients with large limits, particularly in challenged sectors, may find their limits reduced if they have not already seen this happen over the last year.

If you’d like to discuss these insights further, please do not hesitate to contact us.

Title File Type File Size
Directors and Officers Market Update PDF 5.6 MB

Executive Director
Coverage Specialist, FINEX

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