From: Commercial Risk
D&O rates are expected to fall further in 2024 as insurers fight over a smaller pool of premium, although an uptick in insolvency claims may yet check market softening, brokers have told Commercial Risk.
The D&O market was good for buyers last year, with premium savings available again, according to Tom Lazell, associate director for D&O at broker Arthur J Gallagher in London. Insurers had hoped 2023 would be more stable following big price decreases in 2022, the first year of a softening market. “But it has ended up being a lot more aggressive than that, particularly for risks that were opportunistically priced in previous years,” said Lazell.
D&O accounts written in the London market experienced double-digit rate decreases on average in 2023, with the level of softening dependent on industry and geography, according to Stephanie Manson, head of management liability at Marsh in London. “Overall, the market is decreasing and there is no sign of that stopping at the moment,” she said.
Through the end of Q3 last year, D&O pricing for public companies was on average down 18%, according to Manson. “Premiums are still up substantially on 2017 and 2018 levels. At the beginning of 2023 we were showing eight time those levels. So we will still be multiples up on the previous market low,” she said.