Directors & Officers

Whether a company is privately owned or publicly traded, its officers and directors now serve at greater personal risk than at any time in modern history. Today’s directors face an unfriendly legal environment, newly enacted laws, judicial interpretations and public perceptions that impose higher and higher levels of responsibility on one’s conduct and standard of care. In fact, according to one national report, directors and officers are now one-third more likely to face litigation than in any of the previous eight years of the study. Not only has the frequency with which litigation is brought increased, so has the severity: from a $9 million average settlement value in 1996 to almost $35 million in 2004 for shareholder class actions.

In today’s complex business climate, carefully crafted D&O liability insurance is essential to attract and hold talented management and experienced directors. Meyers-Reynolds understands the unique exposures faced by these individuals who undertake never-before-explored opportunities and challenges critical to business success and survival. Among our clients, we have witnessed concepts turned into profitable reality, extraordinary value created out of another’s undervalued assets, and one-of-a-kind alliances of competitive rivals; all involved risk as a constant stimulant to shepherd a vision through to un-guaranteed success, or un-welcomed failure. With a good D&O insurance program, tailored specifically to protect directors and officers from personal financial risk, the best efforts of these individuals can be devoted to running the business.

News-making events involving fraud and misrepresentation of unprecedented financial magnitude are not the events D&O liability underwriters anticipated when the policies were first obtained by the organizations. So it is that the policies offered today contain significantly less coverage for the kinds of claims insurers are now experiencing. When insurers eliminate or constrict protection in the marketplace generally, we have sought and obtained viable alternatives to keep coverage as broad as possible for our clients. Our services include assistance in analysis of limits of insurance, claims trends, arranging corporate governance training, evaluation of policies best suited to the client’s business, and continuity of coverage.