Why are directors’ and officers’ liability costs increasing so much? A blog post from our corporate partner, MFL

Those Medilink members that arrange Directors’ and Officers’ Liability Insurance may have had a nasty surprise when renewing their cover with some significant hikes in premium and the removal of certain aspects of cover.

The UK D&O market has matured over the last 15 years or so. Prior to that D&O cover was not a common policy for businesses but as senior individuals in companies have become increasingly in the spotlight demand has grown.

This demand saw the market flourish and an influx of insurers that drove the market down in price with some estimating that over that period overall premiums shrank by around 50%.

In addition, as insurers fought for market share, they started to provide wider and wider cover.

Claims costs started to increase as regulators, shareholders, investors and other external parties held those in the Boardroom to account for their running of the company.

Those claims have arisen from a number of sources – class actions, shareholder dissatisfaction, insolvency, Board misstatements that affected investor decision making, Health and Safety issues and increased regulatory scrutiny amongst others leading to insurers focusing on improving their underwriting performance.

To correct their position insurers have focused on increasing premiums and reducing the scope of cover that they provide.

The position is amplified for businesses operating in the wider Life science sector an area that has always presented challenges for insurers due to some of the more long tail aspects of bringing products to market. Those that have external investment, poor recent financial performance, US activity or have gone public are likely to be affected most.

MFL has significant experience and access to specialist insurers in these area that full understand the risks involved and can help any member that may be looking for an alternative view. Please do get in touch for help and support.

Contact details:

Mark Philmore ACII, Chartered Insurance Broker


DDI 0113 323 1042

[email protected]

Trudy Kelly


DDI 0161 233 4494

[email protected]


Authorised and regulated by the Financial Conduct Authority. MFL Science & Technology is a trading name of MFL Insurance Group Ltd. Registered in England Wales. No: 02817700.