“Today it’s a tough time to be a director and officer, and that means it’s a tough time to be a D&O underwriter,” according to Doug Poetzsch, senior vice president, head of specialty claims for Ace USA based in New York. Speaking on a panel about the “State of the Market” at the Professional Liability and Underwriting Society (PLUS) D&O West Symposium, recently held in San Francisco, Poetzsch noted today’s headlines of SEC investigations and directors stepping down from office are perfect illustrations of the challenges D&Os are facing.
In noting other D&O market trends, panelists David Bradford of Advisen in New York , Carrie Brodzinski of Beazley in Farmington, Conn., William Hopkins of Starr Excess Liability Insurance Co. in New York, Stephen Marohn of American International Group in San Francisco, Susan Miner of NASDAQ Insurance Agency-Carpenter Moore in San Francisco, and Garick Zillgit of Benfield in San Francisco, indicated the market is soft, with many more competitors today and relatively low pricing.
“Capacity is abundant and stable for now,” Bradford said.
Among the challenges facing D&O underwriters are globalization of businesses and executives’ desire for Side A coverage.
Miner said more and more businesses are expanding their operations, forming joint ventures or partnerships with foreign companies. As a result, D&O underwriters and their customers need to educate themselves on what coverages are required and local laws.
Hopkins said since the Enron and WorldCom scandals, executives are increasingly interested in picking up Side A coverage to help protect their personal assets. More carriers are offering the protection, and not all policies are the same, further emphasizing the need for a well-educated underwriter, he said.
The PLUS D&O West Symposium was held at the Fairmont Hotel in San Francisco on Sept. 12-13. For more information on the symposium, as well as on future events, visit www.plusweb.org.
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