Overview
The marketplace for public company directors and officers (D&O) liability insurance remained largely favorable for insureds through 2025, with competitive renewal terms and aggressive new business offerings widely available. Most public companies continued to secure savings across their D&O programs, although rate decreases have slowed meaningfully after consecutive years of double digit premium cuts.
Slower capital markets activity in recent years limited new business opportunities for D&O insurance companies and created an excess supply of capacity, which put downward pressure on rates. While a supply–demand imbalance still exists, the market showed signs of stabilizing, particularly in the second half of 2025. Looking ahead, an expected increase in capital markets activity in 2026 should support further stabilization in the current rate environment.
Marketplace trends
Pricing
Both newly public (within the past three years) and existing public companies continued to secure premium reductions across their D&O programs in 2025. In general, average premium decreases were lower compared with the prior two renewal cycles, particularly where clients renewed with incumbent insurers. Rate reductions for newly public companies continued to outpace those available for existing public firms, based on higher premiums typically associated with initial public offering (IPO) business.
Looking ahead in 2026, many insureds can expect rate movements to stabilize, with most renewals trending toward flat pricing. While decreases may still be available for certain insureds, insurance companies are signaling a more measured approach across D&O business in the coming months.
Capacity
Insurance capacity has remained readily available across the market, though it has tightened somewhat recently due to mergers and acquisitions among insurance companies. Barring significant new claims activity or severe adverse developments on existing claims, we expect D&O capacity to remain stable and plentiful through 2026. At the same time, new business opportunities may draw capacity away from traditional renewal business, where premiums have been significantly reduced.
Instead, we anticipate insurers may seek to deploy capacity on higher-priced new public company business. Strong economic conditions and constructive investor sentiment support a potential uptick in IPO activity in 2026, which would further increase demand in the D&O marketplace.
2025 Securities class action update
- 2025 filings data: 188 total securities class actions (SCA) filed in 2025, which is down modestly from 211 total filings in 2024
- Companies in the healthcare sector remain the most frequent targets for plaintiff firms, with 64 suits filed to date in 2025, representing over 30% of all filings. In previous years, the number of healthcare filings averaged approximately 35% more than the next largest industry segment (technology). However, in 2025, the number of healthcare filings (64) was 100% more than the technology sector, concluding that healthcare companies represent a more significant target of plaintiff firms than in previous years.
- Firms in the consumer discretionary, financial, and industrial sector continue to fill the third, fourth, and fifth spots in the industry SCA rankings.
- 2025 Settlement data: 104 settlements in 2025, which is consistent with previous years
- The median settlement was $15.48M,which is a significant increase from the $12.25M median settlement amount average over the previous four years.
- From an industry standpoint, the average healthcare settlement was $32.2M, which is very consistent over the past four years, ranging between $31M and $35M during that time.
What to expect for 2026
Overall, the D&O marketplace is expected to move toward greater stability in 2026, as insurance companies assess the adequacy of their portfolios following several years of aggressive rate cuts. Premiums are expected to trend toward flat pricing across most renewals, with some modest rate decreases still available for certain insureds.
Insureds seeking to drive more material premium savings may still find cost savings across the market but will need to shift away from established insurers and partnerships. In doing so, they may consider newer, more aggressive market entrants, but may have more limited data available regarding claims-paying history and general market behavior.
Boardroom hot topics for 2026
- Artificial intelligence (AI) and generative AI
- Cybersecurity and data privacy
- Complex geopolitical landscape
- Digital asset treasury and cryptocurrency
For more information, contact our team today.
This document is intended for general information purposes only and should not be construed as advice or opinions on any specific facts or circumstances. The content of this document is made available on an “as is” basis, without warranty of any kind. The Baldwin Insurance Group Holdings, LLC (“The Baldwin Group”), its affiliates, and subsidiaries do not guarantee that this information is, or can be relied on for, compliance with any law or regulation, assurance against preventable losses, or freedom from legal liability. This publication is not intended to be legal, underwriting, or any other type of professional advice. The Baldwin Group does not guarantee any particular outcome and makes no commitment to update any information herein or remove any items that are no longer accurate or complete. Furthermore, The Baldwin Group does not assume any liability to any person or organization for loss or damage caused by or resulting from any reliance placed on that content. Persons requiring advice should always consult an independent adviser.
