Corporate risk managers looking to gauge the likelihood that their directors and officers will be sued and how much that might cost have a new digital tool to help them.
Global insurance broker Aon has launched its Directors and Officers (D&O) Risk Analyzer, a data-driven application that allows risk managers of U.S.-listed public companies to mitigate executive risks facing their directors, officers and businesses.
“Rising litigation and defense costs, equity market volatility and shifting regulatory frameworks have added complexity for corporate officer risks,” said Timothy Fletcher, CEO of Aon’s financial services group. “It is more important than ever for risk managers to assess D&O liability and the role of insurance in protecting public officers and board directors.”
The tool enables real-time loss forecasting to iterate and quantify D&O risk exposures and loss scenarios, which Fletcher says allows risk managers and brokers to have discussions about the extent of potential risk. Aon says this elevates the focus “beyond expected loss” and empowers risk managers to “better convey risk retention and risk transfer options to the C-suite.”
Fletcher said that the D&O Risk Analyzer, together with Aon’s brokers, provide a “holistic analysis of the D&O risk landscape, helping clients make better decisions.”
Aon’s D&O Risk Analyzer provides clients and brokers access to:
- Real-time analytics, which help clients quantify the likelihood and magnitude of potential D&O losses with data-driven insights on risk retention, risk transfer and maximizing the value of insurance. The risk models can be adjusted in real time based on new client information to provide revised insights on view of risk.
- Risk exposure and loss models, which provide a better understanding of exposure to adverse events, from small to catastrophic impact. Brokers and clients can explore the factors driving D&O litigation and exposure (including stock volatility, liquidity issues, disputed mergers and acquisitions and regulatory matters).
- Stock price drop analysis, which measures how varying stock drops for clients may result in theoretical D&O loss based on historical settlement data.
- Total cost of risk (TCOR) visualizations of all client’s potential insurance options, which help clients explore actionable options to determine value, optimize limits and design the best potential insurance programs in the market, enabling not only better decisions but also the ability to best communicate those decisions.
The launch of Aon’s D&O Risk Analyzer follows the 2024 debuts of the firm’s Property Risk Analyzer and Casualty Risk Analyzer, which provide exposure visualizations and model potential losses.
Aon said it will unveil additional risk analyzer tools in the coming months.
Topics Profit Loss InsurTech Tech Aon
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