State of the D&O market

Despite Directors and Officers (D&O) insurance being a must for businesses of any size, according to recent figures, many directors of SMEs are yet to take up a D&O policy. This lack of cover can mean exposure to a number of risks...

The scope of the risks that directors are facing means that take up of D&O policies has increased significantly over the last 20 years. Today, most directors in the FTSE 250 space will have cover with a growing number insisting it is in place to protect their interests before they would even consider a directorship.

But, although it is almost ubiquitous in the FTSE 250 space, there is much lower penetration among smaller companies. Datamonitor’s SME Insurance Survey, which was conducted in August 2014, found that only 23.3% of respondents had D&O cover – remaining static from 2013, and down from the previous year’s figure of 26.7%. The figures are even lower in the micro-SME sector, with just 10.6% of those surveyed having D&O cover.

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