The Baldwin Group and Nasdaq have released their fifth annual 2026 Directors & Officers (D&O) Benchmarking Report, indicating that the D&O market has moved into a more stable phase after record-high premiums in 2022.
The report found that about 54% of companies say D&O premiums remain broadly flat year over year, 30% recorded moderate decreases of 10% to 30%, and only 10% achieved reductions of more than 30%. The distribution pointed to a market that is stabilizing rather than continuing to soften aggressively.
“The D&O market has clearly moved into a more balanced environment,” said Mike Tomasulo, senior managing partner at The Baldwin Group. “While we are still seeing competition among insurers, especially on excess layers, there also seems to be a more disciplined approach from primary carriers that are less willing to extend premium and retention decreases without the risk exposure justifying it.”
The report noted that sector-level differences remain pronounced. Healthcare and technology continue to attract the highest premiums and retentions, reflecting elevated exposure to securities litigation and regulatory scrutiny.
By contrast, materials, consumer discretionary and industrials saw some of the largest premium decreases, suggesting that these sectors have experienced the sharpest correction after the hard market peak.
US federal securities class action filing activity has eased from post‑2017 highs but remains elevated by historical standards, with core filings still above long‑term averages and technology, life sciences and financial services among the most frequently targeted sectors. That claims environment helps explain why underwriters remain cautious on certain industry segments, even as overall pricing has cooled.
The divergence means the D&O market cannot be treated as a single cycle. Some books are stabilizing at still‑high rating levels, others are experiencing genuine softening, and a few niche areas remain tight because of recent loss activity or perceived emerging risks.
As rates have eased from their 2022 peak, buyers are recalibrating their risk‑transfer strategies. According to the 2026 benchmark, average total D&O limits have risen to $66 million. While part of that increase reflects a greater proportion of large‑cap companies in the dataset, it also points to insureds using improved pricing to rebuild or extend limits that were cut back during the hard market.
For underwriters and brokers, this has several implications. Excess and Side A layers remain competitive, with more capacity seeking to attach higher in the tower, particularly for well‑performing risks. Primary carriers appear more disciplined on base pricing and retentions, relying on underwriting information such as financial strength, governance, claims history and sector profile to resist across‑the‑board reductions. Boards and risk managers are reassessing tower adequacy in light of recent settlement trends and large event‑driven claims, including cyber incidents, ESG‑related allegations and regulatory investigations.
The trend back toward higher limits will be welcomed by many advisers who were concerned that, during the height of the hard market, some issuers reduced limits to levels that may have been out of step with their market capitalization and risk profile.
The Baldwin/Nasdaq report also highlighted the link between D&O pricing and capital markets activity, particularly in the $250 million to $1 billion market‑cap band where IPOs and de‑SPACs have been concentrated.
Newly public companies have historically generated disproportionately high D&O loss activity, with securities class actions against IPO and de‑SPAC issuers featuring prominently in recent years. A subdued IPO market in 2022–2023 contributed to reduced inflows of this higher‑risk business, easing some pressure on D&O capacity.
With IPO activity showing early signs of recovery in 2025–2026, especially in sectors such as technology, life sciences and consumer brands, D&O underwriters are watching closely. A sustained pickup in listings could gradually add demand back into the market and test current pricing levels, particularly for growth‑stage issuers with more volatile business models or complex capital structures.
That points to a potential next phase of the D&O cycle in which competition remains healthy for established, well‑performing public companies, especially on excess layers, while newly public or higher‑risk names may face more differentiated pricing, higher retentions and closer scrutiny of governance and disclosure controls.
The report framed benchmarking as a key tool for boards and risk managers as they navigate these dynamics.
As organizations contend with changing litigation patterns, closer regulatory oversight around areas such as ESG and climate disclosures, cyber incident reporting and executive compensation, and a shifting capital markets backdrop, understanding how a D&O program compares to peers on pricing, limits, structure and terms is becoming part of good governance practice.
The Baldwin/Nasdaq dataset offers another reference point when advising on renewals, tower design and negotiations with carriers. In a market that is no longer in crisis but not uniformly soft, the ability to articulate where a client sits relative to its peer group – and why – is likely to be central to D&O discussions in the 2026–2027 renewal seasons.
