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Top 8 Strategies for your D&O Insurance Renewal

Securing a competitive D&O insurance renewal is becoming harder in the wake of Royal Commissions such as the recent one into the Banking, Superannuation and financial services industries, enhanced Directors responsibilities and the hardening of the Australian D&O market following increased shareholder class action suits hitting publicly listed companies. The key to a successful renewal is to engage with your broker early and often to ensure that the renewal process runs smoothly with the most competitive outcome for the Board.

We’ve put together what we believe are the Top 8 strategies to adopt as you work with your D&O broker on renewal:


Directors and Officers Insurance is a specialised field. Understanding the legislative and regulatory framework and the D&O Insurance market is something a skilled D&O broker is better positioned to do and who should advise the Board. While the Board and individual Directors might have a preferred broker they have used historically for their operational insurance, that broker may not have the expertise or experience required to negotiate the best D&O insurance renewal terms with the insurers.


The pre-renewal process needs to start early. By starting early you provide the insurer with enough time to ask any pertinent questions and for the insured to supplement with additional information. There’s a balance between starting early, however, and needing to update the proposal part way through the renewal process because the information has become stale in between the initial submission and the placement. The optimum renewal period is typically between 60-90 days before expiry.


By starting early, it’s possible to ensure that there is enough time for broker/client meetings for information gathering and also for the insurer to request any meetings they might require with Board members and key management. By facilitating these one-to -one meetings the end result may well be superior renewal terms than initially contemplated.


The Board and the broker should examine the strategy adopted for the D&O insurance in the prior year. Questions to consider include:

Why did we choose that structure and limit?

Has our strategy changed since last year’s insurance was put in place?

Is that structure and limit still appropriate for this year’s renewal taking into account any changes to the strategy, our business or any new markets?

What does the current D&O Insurance market look like and how will that affect the D&O insurance renewal terms and premium we might be able to secure?


A comprehensive submission sent to the underwriter with all relevant information is extremely important. The quality of the information provided to the insurer can be the difference between uncompetitive renewal terms and an attractive renewal. It’s important for the broker to present a balanced submission to the insurer. Considerations for the submission include:

Governance considerations – key policies and overall governance culture in the organisation. By providing detailed information about the internal processes and governance structures in place in the organization you can potentially avoid the need for some endorsements; for example, Bribery and Corruption.

Board composition -highlight the experience of directors with proven track records on other companies and particular governance skills;

Positive milestones achieved in the course of business and whether these change the nature of the risk.


With the change in insurer appetite as the market has hardened, there has been an increase in endorsements aimed at protecting the insurer from claims arising in connection with financial collapse for example, broad Insolvency and withdrawal of support. By starting the pre-renewal process early a broker can obtain the necessary additional information from the insured, relay targeted questions from the insurer and flesh out the publicly available financial information to potentially avoid the inclusion of these onerous endorsements.


Completing the proposal form and collating the necessary information early means a detailed submission is prepared for the insurer which can highlight any substantive changes that have occurred since the last renewal. Key matters that the insurer may consider might be acquisitions which have taken place, expansions into new markets / locations, substantive changes to the shareholder base and large capital raisings (although if these have been above a prescribed threshold they would have been advised to the insurer during the course of the policy period to arrange for inclusion in policy cover).


By engaging with the incumbent insurer early you may be able to ascertain in general terms what their position on the renewal will be. At the very least you will be forewarned  if for any reason they intend to reduce capacity, increase premiums to an intolerable level or at the very worst decline to offer renewal terms. It’s important for the insured and broker to work together to ensure a comprehensive marketing exercise can be undertaken so that the insured is not left having to accept mediocre terms. Alternative markets do exist and given sufficient time an extensive marketing exercise can help identify these alternatives.

Have any questions?

Talk to one of our D&O Experts today!

About KBI

KBI is a boutique insurance brokerage with a focus on Directors’ & Officers’ insurance. Our team has placed Directors’ and Officers’ Liability Insurance for over 300 public companies in Australia, Asia, North America and Europe, including the ASX, TSX/TSX-V, SGX, LSE, Nasdaq, NYSE and LSE/AIM. Our team consists of senior brokers, lawyers and past ASX listing advisors. We add value to the process by helping our clients make an informed decision during the purchasing and claims process. We also continue to provide updates to our clients, so they are properly informed on the ever-changing landscape of Directors & Officers insurance.

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