How Emerging Trends Are Making Excess Limits Essential

// December 5, 2019
Reading Time: 3 minutes

Over the past year, we have witnessed many forms of event-driven litigation as a result of the #MeToo movement, cyber security breaches, wildfires, power shutdowns, U.S. Securities and Exchange Commission (SEC) scrutiny in pre-initial public offering (pre-IPO) companies, and the rise of shareholder activism. These events have consequently given rise to professional and management liability claims, changes in the insurance market, and demands for excess policy limits.

Risk management has become paramount in protecting peoples’ privacy and confidentiality in today’s ever-evolving technological world. Media outlets frequently blast headlines about companies getting hit with cyber assaults and distributed denial of service (DDoS) attacks. Companies that rely heavily on their websites to generate revenue can sustain significant economic damages if their websites become inoperable due to cyberattacks. Moreover, the costs associated with regulatory compliance, sending proper notification, credit monitoring services, forensic investigation, and payment card industry (PCI) fines and penalties could easily deplete primary policy limits.

Directors and officers also face increased scrutiny from shareholders and regulatory agencies in upholding their fiduciary duties and making prudent decisions. The SEC is now more involved in private-company financial statement disclosures and representations. Investor or shareholder derivative claims can easily burn through primary management liability policy limits due to the severity of the lawsuits and the length in which they get litigated. In addition, companies are finding themselves defending an uptick of sexual harassment and discrimination lawsuits that are more prevalent today than ever.

These emerging trends continue to impact our industry and change how companies are being insured. It is increasingly important for companies to buy enough limits of insurance to protect themselves, as policy limits can erode quickly when disaster strikes.

It is also important to note that even small insured organizations have a need for excess limits when meeting mandatory insurance requirements outlined in contracts with vendors and consultants. Excess professional liability policies, which offer additional limits over a primary policy, provide a way to meet these contractual requirements.

Devon Park Specialty’s Excess Professional Liability product offers a solution for your excess professional coverage needs. With limits up to $5 million, Devon Park Specialty can consider excess coverage for a broad range of classes. For errors and omissions, media or cyber accounts, this product is available to companies with revenues up to $500 million. For directors and officers, employment practices or fiduciary liability policies, we can consider private and nonprofit organizations with up to 3,000 employees.

Devon Park Specialty’s Excess Professional Liability product has many advantages:

  • Limits up to $5 million available
  • Follow-form excess
  • Ability to write first excess or within a tower
  • Limits can attach over sublimits
  • Carrier rated A++ by A.M. Best
  • World-class legal services and breach vendors

Please contact your Specialty Lines underwriter for more information or a quote.


As always, thank you for your support and business.

Contact and Written By Kenny Bang
Assistant Vice President, Team Leader, Management Liability Product Leader | 844-438-6775, ext. 2923
December 5, 2019