Increases in director-and-officer (D&O) insurance are rising as companies are now paying more to insure their top-level executives in the case of a lawsuit.
The increase comes as shareholder litigation rises in both number of cases and size of settlements. With greater risks in the market and more expensive insurance, companies buying insurance are trying to maintain costs by raising their deductibles or reducing maximum payout amounts, as well as looking into self-insurance options. The cost-reducing measures put costs more on the shoulders of the companies in case of a lawsuit, especially as a rise in shareholder litigation is expected by lawyers over COVID-19 mishandling issues among many companies.
