With Regulatory Risks High, Companies Purchasing Higher Insurance Limits for Corporate Officers

Companies concerned about their corporate officers' exposure to regulatory claims are purchasing ever-higher limits on existing insurance policies, reports The Wall Street Journal (WSJ).

Many insurance policies do not cover the cost of legal settlements for regulatory claims, which leaves many of the top brass at companies exposed to "a highly litigious environment," according to one source interviewed by the WSJ.

"The policies, generally called "D&O liability insurance," shield board members and executives from personal losses when regulators, shareholders, employees or clients sue a company," said WSJ.

Respondents to a survey of 400 companies-not necessarily involved in the life sciences-reported that regulatory claims had surpassed fears about class-action lawsuits.

Read more:

WSJ - More Paid to Shield Directors, Officers From Lawsuits