Hit enter to search or ESC to close





5 September 2023

Client Advisory     

Directors and officers liability insurance (D&O) update

Two business men shaking hands

It is encouraging to note that rates for directors and officers liability insurance (D&O) have stabilised for most corporate clients as the hard market conditions continue to ease.

Recent legislative changes in Australia and an influx of capacity into the London D&O insurance market have contributed to the softer market, which has put pressure on the New Zealand market to reduce pricing.

This is particularly the case in excess layer placements or ‘top up’ cover. However commercial and SME clients are likely to face inflationary premium increases.

While the D&O market has softened somewhat, the global economic and geopolitical landscapes continue to remain challenging, with higher global interest rates, inflationary pressures, the impact of the Ukraine conflict and supply chain interruptions.

The combination of these factors, together with the protracted nature of D&O liability and other financial lines claims and the anticipated legislative changes following the conclusion of the Law Commission’s investigation into Class Actions and Litigation funds, could all negatively impact the market and pricing going forward.

What this means for our clients

The hard markets of 2020/2021 are firmly behind us for most D&O liability risks. However clients should continue to demonstrate their financial viability to insurers and importantly, show how they are addressing cyber and data security, environmental, social and governance (ESG), supply chain and business continuity.

The uplift in event-driven D&O claims globally (including data breaches and greenwashing) means insurers now expect more from directors’ risk management approach to their company’s overall operational resilience. Insurers are also showing a heightened awareness of these risks.

Risk management is now as important as a company’s financial position when it comes to underwriting criteria, which had not previously been the case.


Jan broker with client

Further information

If you have any questions or want to understand the impact of these changes on your specific situation, please contact your Crombie Lockwood broker.

For more information on issues impacting the insurance market read our August 2023 Insurance Market Update. 

Download report (PDF, 3MB)