According to Advisen’s Loss Insight database, more US companies purchase D&O coverage than EPLI or both. In the past five years, 52.3 percent of private companies with more than 1,000 employees bought the directors and officers insurance, compared to 56.5 percent of public and private companies combined, as shown in the chart below. While 32.11 percent of the private companies bought employer practices liability insurance during the period, 42.5 percent of all companies did. Twenty-three percent of private companies bought both types of insurance, compared to 34.4 percent of companies overall shown in the chart.
Data also show that, as of last year, 22.6 percent of private companies in the US held D&O policies, compared to the 26.2 percent of public and private companies combined, as shown in the chart below. For EPLI, 11.5 percent of private companies have the coverage, compared to the 12.2 percent of companies overall in the chart.
Most EPLI-related claims are for alleged violations of wage and hour laws. The below chart also shows that the second-largest claims source is discrimination and harassment, based on gender or sexual orientation. The third biggest is discrimination and harassment based on race. These trends have been fairly consistent for the past decade.
Under D&O policies, most claims derive from capital regulatory actions, followed by merger objection and securities class action cases, as the chart below shows. A “sea change” in the frequency of all of the cases occurred at the climax of the financial crisis in 2011.
