The costs of directors and officers liability insurance for financial institutions significantly increased in the fourth quarter of 2007, spurred upward by the subprime mortgage market problems, brokerage Aon Corporation reported late last month.

The finding was contained in the firm's D&O pricing index, assembled by its Aon Financial Services Group. The index tracks changes in D&O premium costs relative to the base year of 2001.

Measured on a price-per-million basis, Aon said D&O insurance costs for banks and securities firms increased 18.7 percent in fourth-quarter 2007, compared to fourth-quarter 2006.

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