30 May 2019 13:30
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According to the firm rating AM Best, the market conditions of the directors and officers insurance (D&O) improved in the United States.
However, challenges await the underwriters active in this market, say the analysts at A. M. Best in a report entitled, Is There Really Light at the End of the Tunnel? (Is there really a light at the end of the tunnel?).
One of the main problems targeted by the analysts at A. M. Best is the emergence of the unicorns, the name given to start-ups who reach a growth ultra-fast. It is that the governance of the unicorns is not always a high level of transparency, they point out. Often, they only share what is convenient for them. Which is not ideal when one wants to cover the liability of officers and directors of a company.
Among the other challenges facing underwriters in the market D&O, we find the cyberrisque, the movement #MeToo, but also the growing presence of activists among the shareholders of a company. Other challenges are emerging, such as the adoption of cryptomonnaies.
The analysts at A. M. Best also note that the growth in the market for D&O in the United States has formed a plateau. Its premium volume was $ 6.6 billion in 2018. Roughly the same level as in previous years.