Marsh expands D&O Echo facility coverage

Marsh has extended its Echo facility to offer clients up to £59m ($75m) in excess directors’ and officers’ (D&O) liability insurance (D&O) coverage.

The broker’s D&O facility will be made available globally to clients in various industries, including within financial institutions.

It will offer up to £59m ($75m) in excess D&O insurance coverage for UK clients and £32m ($40m) for US clients.

Clients will also have the flexibility to pre-purchase limit reinstatements or lock in future reinstatements at a fixed price, providing protection in case limits are exhausted by claims.

The facility was launched in June 2016 and covers directors and officers, commercial crime, employment practices liability, public offering of securities insurance, pension trustee liability, fiduciary duty and D&O for financial institutions coverage.

Stephanie Manson, UK management liability leader at Marsh Specialty, said: “D&O Echo provides clients globally with substantial capacity without being over exposed to a single insurer, which helps limit the risks of market volatility and provides enhanced excess cover beyond what is available in the standard open market.”

Streamline

Marsh explained that the facility, underwritten by Lloyd’s of London insurers, will utilise a streamlined placement mechanism.

This will allow clients to obtain substantial capacity without the necessity to “stack” multiple layers of coverage from various insurers.

The elimination of the stacking process, a common feature seen in recent years in the D&O insurance market, simplifies the insurance placement for clients, said Marsh.

“By reducing the layers of insurance and utilising the Lloyd’s claims scheme, Marsh’s D&O Echo can reduce the number of separate insurers that need to be consulted in the event of a claim, streamlining the recovery process for clients,” explained Marsh.

Lloyd’s of London’s claim schemes, established in 2012, aims to streamline the claims agreement process for multiple Lloyd’s insurers.

For example, the broker’s Global Insurance Market Index, published earlier this month (5 February 2024), highlighted that directors and officers (D&O) rates continued to decrease.

However, clients ”remain concerned that another correction in underwriting sentiment, could result in reduced capacity, substantial increases, and claims complications,” said Manson