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D&O Market Update 2025

An overview and quarterly update of the D&O Market and expected trends for 2025.

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Market Overview

As of June 2025, the directors and officers (D&O) insurance market remains competitive, with abundant capacity driving premium relief for many companies. However, the market shows signs of stabilization, with some renewals experiencing flat or slight premium increases for the first time in 18 months. According to Woodruff Sawyer’s D&O Looking Ahead Guide 2025, premium decreases are slowing, with premiums at 1.9 times the 2018 baseline in Q2 2024, down from 4.7 times in Q1 2021. New insurers are entering the market, taking more risks to increase market share, while established carriers focus on sustainable pricing to avoid losses.

Key trends shaping the current market include:

• Litigation: Securities class action (SCA) filings dropped 26 percent in FY 2024 (583 actions vs. 784 in FY 2023), though financial remedies reached a record $8.2 billion, driven by a major cryptocurrency case. This suggests fewer but high-impact SEC lawsuits, potentially reducing D&O claims frequency but increasing severity for targeted firms. SEC Chair Atkins’ lighter regulatory approach, especially for cryptocurrencies, may decrease enforcement-driven D&O claims in that sector.
• Economic and Geopolitical Risks: Global business insolvencies rose by 11% in 2024, with major insolvencies up 26% year-over-year for Q1-Q3 2024 (344 cases). Continuing war in Ukraine and escalating conflict in the Middle East pose liability challenges, including supply chain disruptions and increased regulatory scrutiny.
• Emerging Risks: Artificial Intelligence (AI) and cybersecurity are driving new claims, particularly in technology and healthcare. AI-related risks include "AI washing," where exaggerated claims lead to securities fraud allegations.
• Regulatory Shifts: A new U.S. presidential administration in January 2025, with Paul Atkins as SEC Chair, may result in reduced regulatory enforcement with a corresponding increase in plaintiffs’ bar activity.

Overall, the market remains soft but concerns about unsustainable premium decreases are likely to lead to tighter underwriting by year-end.