Directors’ and Officers’ Liability Update -- The “E” in ESG
As global losses from natural disasters, cyber breaches/hacks and liability lawsuits continue to increase yearly, insurance companies are beginning to formalize their approach to incorporating ESG.
Research has shown a strong correlation between the strength of a company’s ESG performance and a decrease in the probability of a company experiencing negative incidents impacting financial performance – as well as improvement of a company’s ability to secure insurance coverage in the future. As global losses from natural disasters, cyber breaches/hacks and liability lawsuits continue to increase yearly, insurance companies are beginning to formalize their approach to incorporating ESG factors into the underwriting process across lines of business, particularly influencing outcomes in the Directors’ & Officers’ Liability (D&O) insurance market.