The stock options timing scandal could present new risks fordirectors and officers liability insurance writers, industryexperts warn.
Options timing involves the practice of granting so-called "inthe money" stock options to executives as compensation, withoutputting them at risk of having them turn out to be worthless.
The Securities and Exchange Commission and other federal andstate prosecutors are investigating the activity. Their inquiriescommenced in March after The Wall Street Journal reported thatexecutives were receiving option grants at times when share priceshit lows, leading to suspicions the options were backdated toensure the executive was able to make money by executing them.
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