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Survey: Companies invest more money in D&O liability insurance

Regulatory claims are the biggest concern for companies

We live in a litigious society, there’s no doubt about it. And fear of getting sued can be a powerful motivator, as more and more corporate executives are realizing.

According to the 2011 Directors and Officers (D&O) Liability Survey, which global professional services company Towers Watson released Wednesday, companies are willing to cough up serious cash to keep their leaders safe from litigation. The survey looked at 401 public, private and nonprofit companies.

The results show that 25 percent of public companies, and 14 percent of private companies and nonprofits increased the limits of their D&O liability insurance policies at renewal. The average policy limit in 2011 was $87 million, up from $80 million in 2010.

Regulatory claims were the biggest concern for companies across the board, with 81 percent of respondents listing them as one of their top three concerns.

“The actions of directors and officers today are being watched closely, and they are looking for certainty that their D&O program provides the level of protection needed in advance of the claim,” said survey author and Towers Watson executive liability group member Larry Racioppo in a statement.

Read more survey results at Towers Watson, and analysis in the Wall Street Journal.

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