Insurance Marketplace Realities 2025 Spring Update – Directors and Officers Liability

Rate predictions: Directors and officers liability

	Trend	Range
Public company: Primary, excess, Side A		-3% to flat
Private company: Primary, excess, Side A		-10% to flat

Key takeaway

The predominant message is one of a persistent, competitive marketplace, tempered by pressures toward rate stabilization. Although reductions may still be available on a case-by-case basis, we anticipate the most likely renewal outcome to be flat for stable risk profiles. We’re monitoring the potential for changes to market conditions emanating from macroeconomic factors, as well as recent D&O insurer consolidations.

Underwriting

• Public company
  • Rate environment: Initial indications from markets are likely to be flat, but there may be potential justification and support for modest decreases on a case-by-case basis.
  • Continued focus on coverage/“driving value in a stable environment”: Where insurers may be less able to agree to more favorable pricing, they may be amenable to differentiating their offerings with other areas of value, such as enhanced coverage, including, among other areas, the addition of entity investigations costs coverage and increased sublimits where feasible.
• Private company
  • Primary: Insureds with stable risk profiles continue to see enhanced competition, with a floor of flat renewals and decreases when marketed. Carriers may offer guaranteed renewals and potentially multiyear policy terms, with a refreshed annual aggregate. The market for higher risk profiles is improving but can still be challenging; however, increases remain rare.
  • Excess: As pricing decreases continue to manifest, we’re starting to see a flattening in increased limits factors (ILFs).
  • Retentions: For challenged risks, carriers are pressing for higher retentions. Severity of increases most often depends on prior renewal increases and the need, if any, for continued correction. For smaller risks, lowered SIRs are persistent, allowing insurers to remain competitive.
  • Increased deployment: Carriers are willing to regularly deploy capacity for preferred risks. Additional capacity can be found for more risks. This is having an impact on market conditions more broadly, especially for more desirable risks.
• Challenged risk profiles
  • Non-U.S. parent with U.S. exposures
  • Liquidity-challenged and pre-restructuring/bankruptcy risks
  • Challenged industries, e.g., oil and gas, healthcare, life sciences, higher education, cryptocurrency, cannabis, AI-exposed organizations
  • IPOs, de-SPAC business combinations

Despite challenges and anticipated potential for increases, capacity remains available.

• Risk profile focus
  • Cyber/privacy: Adequacy of disclosures, board oversight
  • Financial strength
  • AI integration and adaptedness
  • Management of guidance in the context of economic factors
  • Industry
  • Claim history
  • Loss-cost escalation
  • Systemic exposures
  • Adaptability to changes in U.S. presidential administrations, including regulatory uncertainty, economic policy shifts and pressures surrounding ESG practices accommodate
  • Exposures to government funding

Download the full D&O report below.

Disclaimer

WTW hopes you found the general information provided here informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors. In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, WTW offers insurance products through licensed entities, including Willis Towers Watson Northeast, Inc. (in the United States) and Willis Canada Inc. (in Canada).

Contacts

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John M. Orr

D&O Liability Product Leader, FINEX NA

email Email

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Lawrence Fine

Management Liability Coverage Leader,
FINEX North America

email Email phone +1 212 309 3623

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