Territory Update
Asia
A recent poll identified the top five risks perceived by directors and officers in Asia, as being cyber attack at 60%, regulatory breach also at 60%, data loss at 59%, Health & Safety prosecution at 58%, and bribery and corruption at 57%.
Australia
Australia's D&O market experienced increased competition in the latter half of 2023. Insurers vied for opportunities to participate in the insurance programmes of well-managed organisations, leading to stabilisation in D&O premiums. While premiums saw little movement, they did not revert to the levels of 2018/2019.
Canada
The Canadian D&O market experienced accelerated rate decreases in the latter half of 2023, laying the groundwork for a more competitive landscape in 2024. Early 2023 saw rate decreases gaining momentum, particularly on towers that had previously experienced significant rate increases. This trend persisted throughout 2023.
Central and Eastern Europe
Despite the ongoing economic uncertainty in the CEE region and the failure of expected GDP growth in many countries, positive developments are emerging in the D&O market. Following years of significant market hardening for both SMEs and large clients, characterised by continuous premium increases and limited capacity, the market began to stabilise in early 2023, with a turnaround in rates observed in the latter half of the year.
Nordics
In 2023, intensified competition among insurers was driven by increased D&O capacity provided by both established markets and new MGAs. Reports of declining claims notifications and USA securities class actions, along with stabilising inflation rates, further contributed to a continued positive shift in the market.
Middle East
In both emerging and established markets throughout the Middle East, we have witnessed accelerated growth and an increasing sophistication among clients, particularly concerning D&O and management liability. This growth can be largely attributed to foreign investment and expat management seeking protection within a legally uncertain landscape.
UK and Western Europe
Throughout 2023 and into 2024, D&O market conditions have continued to soften, with the entrance of new capacity and with no notable insurer withdrawals. Risks originating from the UK and continental Europe remain the primary focus of most London insurers' risk appetites, sustaining high levels of competition. As a result, brokers have been able to negotiate premium and retention decreases, occasionally securing larger lines and broader coverage.
United States
In 2023, the public company D&O market saw a shift in favour of buyers, marked by the entry of over 30 new insurers, amidst declining IPO activity. This influx led to aggressive pricing strategies and expansive terms offered to insureds. As we step in 2024, most public companies have experienced a second consecutive year of notable rate decreases during renewals. This signals a potential stabilisation of the market, particularly with securities class action filings returning to pre-pandemic levels.
South Africa
The local market typically remains the most competitive option in terms of available capacity, premium rates, and retention levels to cater to South African companies that are privately owned or have a small to mid-size market capitalisation, exclusively listed on the Johannesburg Stock Exchange.
