Carpenter Moore’s new “2008 Directors & Officers Liability Insurance Peer Benchmarking Report” finds that financial services companies now pay the highest average premiums for directors and officers (D&O) liability insurance, surpassing rates paid by life sciences and technology firms. Insurance Journal reports that this shift in D&O pricing trends accelerated in the fourth quarter of 2008 as the financial and economic crisis deepened.
The report also found that in the fourth quarter of 2008, only 64 percent of companies saw a decrease in their pricing, down from an average of 77 percent in the first three quarters of 2008. Insurance Journal reports that lower number of companies with decreased pricing “marks a departure from the dominant pricing trend — steady decreases in premiums across all industries — that has characterized the D&O market.”
The author of the report, Carpenter Moore’s Lauri Floresca, stated that “[o]ur data show that the D&O insurance market is clearly hardening for financial services companies, which have been at the center of the economic crisis.”
The 2008 Carpenter Moore report is based on information from more than 500 publicly traded companies that participated in the study, up nearly 30 percent from 2007.