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The Less You Need Coverage, the Easier It Is to Obtain


D&O coverage is available for nearly all insurers, with weaker insurance likely to pay the highest rates and endure the tightest terms.


D&O markets, if they feel that there’s any chance that a company could become unrated or have a very diffi cult ability retaining their business in the next 12 months, then it’s a different ball game. Then you are fi ghting to keep your limits.


Tracy Forst, Aon


Weaker insurers with a higher likelihood of impairment or insolvency face a variety of choices. They may ultimately cease operating, but on the way to dormancy they may shed ratings and begin to exit markets.


Each step could lead to tougher pricing and lower limits on coverage, Tracy Forst said. Insurers that believe their organization may ultimately fail need to review their options early in the process to make sure they retain their protections and limits.


“Generally the market will write you. They’re all looking to write premiums if you’re rated. You may have to pay more if your rating is not as high as somebody else, but I think you can get it,” Forst said. “I would say that if you think you could be impaired in the next 12 months to the extent that you can’t retain policies, then you have to aggressively try to protect your D&O insurance through various means.”


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