Directors and Officers Liability Survey Summary of Results

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Directors and Officers Liability Survey

2010 Summary of Results

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Introduction

Welcome to the 2010 Directors and Officers (D&O) Liability Survey, the 32nd in a series of studies conducted by Towers Watson.

The 2010 survey was conducted online from October 5 through November 4, 2010. A total of 496 organizations that purchase D&O liability insurance participated in the survey.

Unlike prior surveys that included responses from brokers, the participants in this survey were predominantly insurance buyers. As a general rule, given the manner in which the survey was conducted, we made comparisons to our 2008 survey when the data were relevant and reflected meaningful change.

Given the many exposures facing directors and officers today, the goal of this survey was to determine if there has been a material change in the purchasing patterns surrounding D&O coverage.

In light of the above, the survey questions focused primarily on an organization’s D&O program, and were not intended to capture information relative to other lines of coverage (EPL, fiduciary, etc.) as in prior studies. Similar to previous years, we also provided a directory of insurers that write D&O coverage. Sincere thanks to those who participated in this year’s survey, as well as to Dan Bailey of Bailey Cavalieri, and Kevin LaCroix of OakBridge Insurance Services, for their commentary and contributions. It is your continued support and participation that make it possible to provide this unique report on D&O liability insurance and purchasing trends.

Lawrence A. Racioppo

Executive Liability, Towers Watson larry.racioppo@towerswatson.com

Statistical Terms Used in This Report: In several sections of this report, a distribution of values is described by giving the first quartile, median and third quartile values in addition to the mean, or average, value. Distributions are given for some subsets of the data to enhance interpretations of the survey results. A mean value by itself can be misleading if the underlying distribution is skewed to the low or high side. We report key percentiles to more fully describe each distribution; such values are calculated in accordance with standard statistical formulas. The median is the middle value of a distribution, so that half the observations are less than or equal to this value, and the other half are greater than or equal to the median. About one-quarter of the observations are at or below the first quartile value. Similarly, the third quartile value has about three quarters of the observations at or below it. The range between the first and third quartiles contains values for the middle half of the data.

A non-probability sample is one in which respondents choose — or are selected — to participate. Such a sample is therefore not random. Because not all potential respondents are equally likely to participate, survey biases must be considered when interpreting results.

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• Twenty-one percent of respondents said they increased their D&O limits compared to their prior D&O policy (versus 12% in 2008), while 75% said their limits stayed the same (versus 86% in 2008). Only 3% said they decreased their limits.

• Fifty-three percent of respondents (excluding charities and nonprofits) said their companies have international operations. Of this figure, 47% purchased a local D&O policy in a foreign jurisdiction. This is a marked increase over 2008 results, whereby only 2% of respondents with international operations purchased a local policy in a foreign jurisdiction.

• More than 80% of public company respondents purchase Side A coverage, which reflects a significant increase over 2008. Clearly, the Side A policy has become an integral component of an organization’s D&O program structure.

• When asked if they had conducted an independent review of their D&O program within the past two years, 54% of respondents said that they had not.

• This year’s survey findings suggest increased apprehension over regulatory claims. When asked to rank the types of claims of greatest concern, direct shareholder/investor suits topped the list, followed by regulatory claims and employment-related litigation. The top three types of claims of greatest concern overall were regulatory claims, followed by direct shareholder claims and derivative claims. • When asked how their D&O program was structured,

35% of nonprofit and 22% of private company respondents said they were not sure. This finding suggests that brokers and other management liability consultants need to spend more time educating their nonprofit and private company clients about the type of insurance coverage purchased.

• All dollar amounts reported are in U.S. dollars.

2010 Survey Highlights

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The 496 participants in our 2010 survey represent a wide range of industries. Manufacturers, the largest single business class, accounted for 14% of respondents, followed by insurers (13%) and energy/ utilities (11%). Other well-represented groups include financial services, excluding insurance (10%), health care, excluding pharmaceuticals (8%), and retail/ wholesale (6%) (Figure 1).

When broken down by ownership, 56% of respondents were public companies, 24% were private companies, and 16% were charities and nonprofit organizations. The remaining 4% identified themselves as “other”

(Figure 2). 56% Public 24% Private 16% Charities and Nonprofits 4% Other 24% 00% 00% 16% 56%

Figure 2. Participation by ownership 4%

0% 5% 10% 15%

Other Transportation Retail and Wholesale

Professional and Business Services Natural Resources

Manufacturing High Technology

Health Care — Pharmaceuticals Health Care, excluding Pharmaceuticals Government and Education

Food and Beverage

Financial Services — Insurance Financial Services, excluding Insurance Energy and Utilities

Communications Charities and Nonprofits

Automobiles and Transport Equipment Aerospace and Defense

2

Figure 1. Participation by business class

4 4 1 1 2 2 11 11 10 10 13 13 3 3 4 4 8 8 4 4 4 4 14 14 3 3 2 2 6 6 3 3 6 6

Participant Profile

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When asked to categorize their size in terms of global revenues, total assets and market capitalization, roughly one-third of respondents were in the $1 billion-to-$4.9 billion range for each of these criteria (Figures 3-5).

In terms of global revenues, the average was $3.7 billion, with 18% reporting revenues of less than $250 million and 16% reporting revenues of $10 billion or more (Figure 3).

Average company assets were $4.6 billion. Fifteen percent of respondents reported less than $250 million in assets, and 25% reported $10 billion or more in assets (Figure 4).

Average market capitalization reported by respondents was $4.6 billion. Eight percent of respondents reported $250 million or less, while 26% reported a market capitalization of $10 billion or more (Figure 5).

0% 10% 20% 30% 40%

Less than $250 million $250 million to $499 million $500 million to $999 million $1 billion to $4.9 billion $5 billion to $9.9 billion $10 billion or more

Figure 3. Participation by size Total revenues

Average: $3.7 billion

(excluding charities and nonprofits)

16 16 13 13 16 16 8 8 9 9 18 18 13 13 36 36 8 8 9 9 18 18 0% 10% 20% 30% 40%

Less than $250 million $250 million to $499 million $500 million to $999 million $1 billion to $4.9 billion $5 billion to $9.9 billion $10 billion or more

Figure 4. Participation by size Total assets

Average: $4.6 billion

25 25 14 14 31 31 7 7 8 8 15 15 0% 10% 20% 30% 40% $10 billion or more

Figure 5. Participation by size Market capitalization

26 26

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In actual numbers, 124 respondents reported $1 billion to $4.9 billion in assets, 60 reported less than $250 million in assets, and 99 had revenues of $10 billion or more. One hundred forty-four respondents reported revenues between $1 billion and $4.9 billion, 75 had revenues of less than $250 million, and 63 had revenues greater than $10 billion (Figure 6). Excluding charities and nonprofit organizations, 53% of respondents said their companies have international operations. Of these companies, close to half (47%) stated they purchased local policies in foreign jurisdictions. This is a marked increase over 2008 results, when 98% of respondents said they were relying on their master D&O policy to afford global coverage (Figures 7 and 8).

Figure 7. Internal operations by ownership

Yes No

Nonprofits 14% 86%

Private 38% 63%

Public 62% 38%

All groups excluding

charities and nonprofits 53% 47%

All groups (total

respondents) 47% 53% 0 50 100 150 $10 billion or more $5 billion to $9.9 billion $1 billion to $4.9 billion $500 million to $999 million $250 million to $499 million Less than $250 million

Assets

Revenue

Figure 6. Number of participants by size

60 60 75 75 31 31 35 35 27 27 32 32 124 124 144 144 56 56 52 52 63 63 9999

25% Yes, and purchase local policies in foreign jurisdictions 28% Yes, but do not purchase local policies in foreign jurisdictions 47% No 28% 00% 00% 47% 25%

Figure 8. Does your organization have international operations? Do you purchase local policies in foreign jurisdictions?

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Figure 7. Internal operations by ownership

Yes No

Nonprofits 14% 86%

Private 38% 63%

Public 62% 38%

All groups excluding

charities and nonprofits 53% 47%

All groups (total

respondents) 47% 53%

Figure 9. Purchase of local policies by asset size

Yes No

Less than $250 million 23% 77%

$250 million to $999 million 32% 68%

$1 billion to $4.9 billion 39% 61%

$5 billion to $9.9 billion 49% 51%

$10 billion or more 68% 32%

All size groups excluding charities and nonprofits 45% 55%

All groups (total respondents) 47% 53% As a general rule, the larger the company, the more

likely it was to buy local D&O coverage. For example, 68% of companies with $10 billion or more in assets said they bought local policies, while only 23% of companies with less than $250 million in assets did so (Figure 9).

Overall, multinational organizations understand that the risk environment has clearly changed. Navigating local laws and regulations is complex and often varies by country. The good news? As a result of time spent getting educated about critical issues, more companies are making informed decisions about how to best protect their directors and officers.

The average number of board members for the companies responding was 12, although the actual numbers ranged both higher and lower than those for many companies. Roughly two-thirds of participants had nine or fewer board members with close to a third (31%) having fewer than six. Twenty-three percent had 10 to 12 board members, and 11% had 13 or more (Figure 10).

Thirty-one percent of respondents had fewer than six independent/outside directors, 35% had six to nine, 23% had 10 to 12, 7% had 13 to 20, and only 4% had more than 20 (Figure 11).

7% More than 20 18% 13 to 20 33% 10 to 12 34% 6 to 9 8% Fewer than 6 7% 00% 00% 34%

Figure 10. How many directors comprise your board of directors?

18% 33% 8% 4% More than 20 7% 13 to 20 23% 10 to 12 35% 6 to 9 31% Fewer than 6 7% 31% 23% 35% 4%

Figure 11. How many of these are independent/outside directors?

25% Yes, and purchase local policies in foreign jurisdictions 25%

Figure 8. Does your organization have international operations? Do you purchase local policies in foreign jurisdictions?

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Predictably, larger companies had a higher average number of board members. Companies with $10 billion or more in assets had an average of 13 board members, while companies with less than $250 million in assets had an average of seven members

(Figure 12).

Fifty-seven percent of respondents said they had been asked by a director about the amount and scope of their D&O coverage in the past year (Figure 13). When asked if they had conducted an independent review of their D&O policy in the past two years, 54% of respondents said they had not. Of the 46% that did conduct a review, 43% said they used an outside broker, 41% had turned to a law firm for the review and 15% engaged a consultant. (Figure 14). The competitive insurance market may explain why more companies are not having their D&O program reviewed. Respondents may also have confidence in their current broker’s knowledge and level of service provided.

57% Yes 43% No

57% 00%00%

43%

Figure 13. Within the past 12 months, has there been inquiry from a director or officer regarding the amount and scope of coverage?

20% Yes, through another broker 19% Yes, through a law firm

7% Yes, through a consultant 54% No 19% 00% 00% 54% 20%

Figure 14. In the past two years, have you conducted an independent review of your D&O liability policy?

7% 0 5 10 15 $10 billion or more $5 billion to $9.9 billion $1 billion to $4.9 billion $250 million to $999 million Less than $250 million

Figure 12. Number of board members by asset size

7 7 9 9 10 10 11 11 13 13 8 8

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Figure 15. Total limits by asset size ($ millions) Participants reporting First quartile Median Third quartile Average

Less than $250 million 60 $ 3.0 $ 8.5 $ 15.0 $ 11.5

$250 million to $999 million 58 15.0 25.0 50.0 37.9

$1 billion to $4.9 billion 123 30.0 55.0 100.0 62.8

$10 billion or more 98 100.0 175.0 300.0 197.7

All size groups excluding

charities and nonprofits 414 20.0 55.0 125.0 90.4

All groups (total respondents) 493 $ 15.0 $ 50.0 $100.0 $ 80.4

Figure 16. Total limits by asset size ($ millions) Private organizations only

Participants reporting First quartile Median Third quartile Average

$10 billion or more 10 77.5 107.5 212.8 164.6

All groups — private organizations only 119 $ 5.0 $ 15.0 $ 30.0 $ 34.0

Survey respondents included public, private and nonprofit organizations ranging in size from less than $250 million to more than $10 billion in assets. For this aggregate group, the mean limits purchased were $80.4 million, and the median limits purchased were $50 million.

When charities and nonprofits are removed, the average limit was $90.4 million. For companies with $10 billion or more in assets, the average limit was $197.7 million. For companies with between $1 billion

and $4.9 billion in assets, the average limit was $62.8 million. Companies with less than $250 million in assets averaged $11.5 million in limits (Figure 15). The average limit of all private organizations was $34 million. For private companies with $10 billion or more in assets, the average limit was $164.6 million. For private companies with between $1 billion and $4.9 billion in assets, the average limit was $32.2 million. Private companies with less than $250 million in assets averaged $7 million in limits (Figure 16).

Policy Limits

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The average limit of all public organizations was $118.3 million. For public companies with $10 billion or more in assets, the average limit was $211.5 million. For public companies with between $1 billion and $4.9 billion in assets, the average limit was $77 million. Public companies with less than $250 million in assets averaged $21.1 million in limits (Figure 17).

For public companies with a market capitalization of $10 billion or more, the average limit was $227.5 million. For public companies with a market capitalization of between $1 billion and $4.9 billion, the average limit was $92.8 million. Public companies with a market capitalization of less than $250 million averaged $26.1 million in limits (Figure 18).

Figure 17. Total limits by asset size ($ millions) Public organizations only

$10 billion or more 81 120.0 185.0 300.0 211.5

All groups — public organizations only 274 $ 50.0 $100.0 $150.0 $118.3

Figure 18. Total limits by market capitalization ($ millions) Public organizations only

$10 billion or more 63 150.0 200.0 300.0 227.5

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Figure 19. Total limits by business class ($ millions) Participants reporting First quartile Median Third quartile Average

Aerospace and Defense 9 $ 35.0 $110.0 $275.0 $152.2

Automobiles and Transport Equipment 6 50.0 107.5 256.3 161.7

Charities and Nonprofits 18 4.3 6.5 11.3 15.4

Communications 11 50.0 125.0 250.0 167.3

Energy and Utilities 57 77.5 120.0 157.2 133.2

Financial Services, excluding Insurance 51 20.0 30.0 100.0 81.7

Financial Services — Insurance 62 7.0 25.0 62.5 61.8

Food and Beverage 14 17.5 40.0 112.5 65.6

Government and Education 19 5.0 25.0 40.0 27.5

Health Care, excluding Pharmaceuticals 40 10.0 20.0 50.0 45.8

Health Care — Pharmaceuticals 18 2.8 7.5 36.3 54.6

High Technology 18 10.0 32.5 67.5 65.7

Manufacturing 70 38.8 77.5 125.0 96.1

Natural Resources 13 45.0 60.0 110.0 72.8

Professional and Business Services 12 4.8 16.5 48.8 31.6

Retail and Wholesale 31 30.0 60.0 100.0 75.7

Transportation 13 37.5 50.0 92.5 80.4

Other 31 30.0 60.0 105.0 86.5

All business classes (total respondents) 493 $ 15.0 $ 50.0 $100.0 $ 80.4

When broken down by business class,

communications, at $167.3 million, had the highest average limits. Excluding the insurance sector, financial services averaged $81.7 million in limits. Taken alone, insurance averaged $61.8 million (Figure 19).

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21% Increased 75% Stayed the same

3% Decreased 1% Not sure 21% 00% 00% 75% 3%

Figure 20. Compared to your previous D&O policy, has your D&O limit increased, decreased or stayed the same? 1%

Figure 21. Change in limits by business class

Principal business class Increased Decreased Same Not sure

Aerospace and Defense 22% 11% 67% 0%

Automobiles and Transport Equipment 33% 0% 67% 0%

Charities and Nonprofits 28% 0% 72% 0%

Communications 0% 9% 91% 0%

Energy and Utilities 17% 4% 77% 2%

Financial Services, excluding Insurance 24% 2% 74% 0%

Financial Services — Insurance 14% 2% 82% 2%

Food and Beverage 29% 0% 71% 0%

Government and Education 21% 0% 74% 5%

Health Care, excluding Pharmaceuticals 25% 3% 72% 0%

Health Care — Pharmaceuticals 28% 0% 72% 0%

High Technology 28% 5% 67% 0%

Manufacturing 24% 0% 76% 0%

Natural Resources 54% 0% 46% 0%

Professional and Business Services 8% 0% 92% 0%

Retail and Wholesale 16% 7% 77% 0%

Transportation 8% 0% 92% 0%

Other 26% 16% 58% 0%

All business classes (total respondents) 21% 3% 75% 1%

Overall, 21% of respondents said they increased their D&O limits compared to their prior D&O policy (versus 12% in 2008), while 75% said their limits stayed the same (versus 86% in 2008). Only 3% said they decreased their limits, and 1% were not sure

(Figure 20).

Some business classes are more likely to have increased their limits. For example, 54% of natural resource companies, 33% of automobiles/ transportation equipment companies, and 29% of food and beverage companies said they increased their limits (Figure 21).

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Figure 22. Change in limits by asset size Private organizations only

Increased Decreased Same Not sure

Less than $250 million 17% 3% 80% 0%

$250 million to $999 million 20% 0% 75% 5%

$1 billion to $4.9 billion 19% 0% 81% 0%

$10 billion or more 30% 0% 70% 0%

All size groups — private organizations only 18% 1% 80% 1%

Figure 23. Change in limits by market capitalization Public organizations only

Increased Decreased Same Not sure

Less than $250 million 15% 10% 75% 0%

$10 billion or more 32% 3% 63% 2%

All size groups — public organizations only 23% 4% 72% 1%

Eighteen percent of private organizations and 23% of public companies reported increasing their limits (Figures 22 and 23).

Clearly, organizations are reacting to the fact that D&O liability exposures are arguably at an all-time high. Insurance buyers continue to be threatened by a severe litigation environment and have increased concern over potential regulatory investigations.

The current state of the insurance market may have also contributed to the increase in limits purchased. We continue to operate in a highly competitive environment with many insurers chasing fewer clients, which leads to reduced pricing. It may also be likely that purchasers are reallocating a portion of their savings to buy additional limits.

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6% Side A only 19% Side A/B only

60% Side A/B/C 1% Other 14% Not sure 19% 00% 00% 60% 1%

Figure 24. Primary D&O insurance program structure 6%

14%

Figure 25. Primary D&O insurance program structure by ownership

Participants

reporting Side A/B/C

Side A/B only

Side A

only Other Not sure

Nonprofits 79 42% 18% 4% 1% 35%

Private 120 51% 21% 6% 0% 22%

Public 276 71% 18% 7% 1% 3%

All groups (total respondents) 496 60% 19% 6% 1% 14%

When asked how their primary D&O insurance was structured, 60% of respondents said Side A/B/C, 19% said Side A/B only and 6% said Side A only. One percent of respondents said their programs were structured in some other way (Figure 24).

These findings are consistent with a general reduction in Side A only programs, which was 6% in 2010, 11% in 2008, 9% in 2007 and 14% in 2006.

Surprisingly, 14% of survey participants overall were not sure how their programs were structured. This uncertainty about their purchased coverage was especially true among nonprofit (35%) and private organization (22%) respondents. Only 3% of public company respondents were unsure of their coverage

(Figure 25).

As expected, public company purchasers are generally more knowledgeable about their coverage and, in many instances, have dedicated risk management departments. This finding suggests that brokers and other management liability consultants need to spend more time educating their nonprofit and private company clients about their insurance coverage.

Primary D&O Insurance

Program Structure

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24% Yes 76% No 24% 00% 00% 76%

Figure 26. Is your primary limit shared or blended with other coverage (e.g., EPL fiduciary)?

When asked if their primary limit was shared or blended with other coverages, 24% of survey respondents said that it was, while 76% said that it wasn’t (Figure 26).

When asked if they purchased D&O coverage that covers only independent/outside directors, 9% of respondents said yes, while 6% said this coverage is being considered. This contrasts sharply with 2008 survey results, in which only 0.3% of respondents said they purchased D&O coverage that covers only independent/outside directors and only 3.2% were considering it (Figure 27). There are several possible explanations for this significant disparity between our 2008 and 2010 survey findings, including the fact that this question may have been misunderstood by some respondents. In addition, since the sample size is smaller this year, the data is less statistically reliable. From our perspective, since we have not seen an upward trend in the purchase of independent director liability coverage, this number is surprisingly high.

Occasionally, independent/outside directors have D&O liability policies that cover them exclusively. When asked if any of their independent/

outside directors had such a policy, 53% said they were not sure and 43% said no. Only 4% of respondents said that independent/outside directors on their boards had a policy tailored for them exclusively. Half of those respondents said their organizations paid for the policies, while the other half said the directors paid for the policies themselves (Figure 28).

9% Yes

6% No, but this coverage is being considered

85% No, and no such coverage is being considered 6%

00% 00% 85%

Figure 27. Does your organization purchase D&O liability insurance that covers only independent/ outside (excluding inside) directors?

2% Yes, paid by the organization 2% Yes, paid by themselves 43% No 53% Not sure 43%

Figure 28. Do any of your independent directors have individual D&O liability insurance that provides coverage to them exclusively?

9%

53%

2% 2%

9% Yes

6% No, but this coverage is being considered

85% No, and no such coverage is being considered 6%

00% 00% 85%

Figure 27. Does your organization purchase D&O liability insurance that covers only independent/ outside (excluding inside) directors?

2% Yes, paid by the organization 2% Yes, paid by themselves 43% No 53% Not sure 43%

Figure 28. Do any of your independent directors have individual D&O liability insurance that provides coverage to them exclusively?

9%

53%

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When asked if they had purchased an excess Side A or Side A with “difference in conditions” (DIC) policy, 64% of respondents said yes, 29% said no and 7% were not sure (Figure 29).

When compared to their previous excess Side A policy, 16% said that their limits had increased, while 79% said that their limits had stayed the same. Only 3% of respondents said their limits had decreased

(Figure 30).

Side A Only

64% Yes 29% No 7% Not sure 64% 00% 00% 29%

Figure 29. Did your organization purchase an excess Side A or Side A DIC policy?

3% Decreased

2% Not applicable—did not purchase Side A layer prior to this renewal Figure 30. Compared to your previous Side A or Side A DIC policy, has the limit increased, decreased or stayed the same?

79% 3% 16% 2% 7% 64% Yes 29% No 7% Not sure 64% 00% 00% 29%

Figure 29. Did your organization purchase an excess Side A or Side A DIC policy?

3% Decreased

2% Not applicable—did not purchase Side A layer prior to this renewal Figure 30. Compared to your previous Side A or Side A DIC policy, has the limit increased, decreased or stayed the same?

79% 3%

16% 2% 7%

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0% 10% 20% 30% 40% 50%

Other

Premium savings from overall program applied to purchase Board member/individual director required it

Protection against bankruptcy/insolvency of underlying insurer Protection against bankruptcy/insolvency of your organization Concern that a large loss may impact underlying Side A/B/C program Breadth of coverage

Figure 31. Impetus for purchase of excess Side A policy

47 47 46 46 30 30 29 29 28 28 8 8 8 8

There has been a sizable increase in the percentage of organizations that purchase an excess Side A policy or an excess Side A policy with DIC feature. Close to 80% of public company respondents purchase such a policy, which is significantly higher than our 2008 survey findings (Figure 31).

When asked about the main impetus for the purchase of an excess Side A DIC policy, the broad range of responses highlights the fact that clients understand the myriad of benefits offered by a comprehensive Side A DIC program, including:

• Broader coverage than traditional A/B/C policy (47%)

• Dedicated limit to the individual that is not depleted by corporate liabilities (46%)

• Protection against the lack of availability of corporate indemnity (30%)

• Protection against insurer insolvency (29%) Many directors and risk professionals share an underlying sense of concern about their exposure. With premium prices down, it is generally agreed that the purchase of an excess Side A policy is a sound investment.

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Figure 32. Excess Side A coverage by asset size Private organizations only

Participants

reporting Yes No Not sure

Less than $250 million 40 20% 62% 18%

$250 million to $999 million 20 35% 50% 15%

$1 billion to $4.9 billion 36 44% 44% 12%

$10 billion or more 10 80% 20% 0%

All size groups — private organizations only 120 35% 51% 14%

Figure 33. Excess Side A coverage by market capitalization Public organizations only

Participants

reporting Yes No Not sure

Less than $250 million 20 50% 45% 5%

$10 billion or more 65 83% 14% 3%

All size groups — public organizations only 276 78% 19% 3%

Figure 34. Amount of excess Side A limits purchased by asset size ($ millions)

$10 billion or more 82 30.0 50.0 100.0 84.0

All size groups excluding

charities and nonprofits 268 10.0 25.0 50.0 42.2

All groups (total respondents) 289 $ 10.0 $ 25.0 $ 50.0 $ 40.6

On average, 35% of private organizations bought excess Side A coverage. The larger the company, the more likely it was to purchase this type of coverage. For example, 80% of private companies with more than $10 billion in assets in bought a dedicated excess Side A policy, compared to only 20% of private companies with less than $250 million in assets

(Figure 32).

Excess Side A was even more popular with public companies. On average, 78% of public companies purchased excess Side A. In terms of size, 83% of

public companies with a market capitalization greater than $10 billion purchased an excess Side A policy. However, 50% of public companies with market capitalization less than $250 million purchased such a policy (Figure 33).

The average amount of excess Side A limits

purchased by all respondents (excluding charities and nonprofits) was $42.2 million. Companies with more than $10 billion in assets purchased an average of $84 million in Side A limits (Figure 34).

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Figure 35. Amount of excess Side A limits purchased by asset size ($ millions) Private organizations only

Less than $250 million 8 $ 1.5 $ 5.0 $10.0 $ 6.2

$10 billion or more 8 25.0 25.0 47.5 50.0

All groups — private organizations only 42 $ 5.0 $10.0 $21.3 $18.8

Figure 36. Amount of Side A limits purchased by market capitalization ($ millions) Public organizations only

Less than $250 million 10 $ 5.0 $12.5 $ 21.3 $14.5

$10 billion or more 54 50.0 55.0 100.0 96.2

All groups — public organizations only 215 $10.0 $30.0 $ 50.0 $47.5

The average amount of excess Side A limits

purchased by private organizations was $18.8 million. Private organizations with more than $10 billion in assets purchased an average of $50 million in excess Side A limits (Figure 35).

Public companies with a market capitalization of more than $10 billion purchased an average $96.2 million in excess Side A limits. Public companies with a market capitalization of less than $250 million purchased an average $14.5 million in excess Side A limits (Figure 36).

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Figure 37. Change in excess Side A limits by asset size Private organizations only

Increased Decreased Same Not sure Not applicable

Less than $250 million 0% 0% 87% 0% 13%

$250 million to $999 million 29% 0% 57% 0% 14%

$1 billion to $4.9 billion 19% 0% 81% 0% 0%

$10 billion or more 38% 0% 62% 0% 0%

All size groups — private

organizations only 20% 0% 75% 0% 5%

Figure 38. Change in excess Side A limits by market capitalization Public organizations only

Increased Decreased Same Not sure Not applicable

Less than $250 million 0% 10% 90% 0% 0%

$10 billion or more 22% 2% 74% 0% 2%

All size groups — public

organizations only 17% 3% 79% 0% 1%

The survey confirmed that the larger the company, the more likely it was to have increased its Side A limits. For example, 38% of private organizations with assets in excess of $10 billion increased their Side A limits. Likewise, 22% of public organizations with assets greater than $10 billion increased their Side A limits

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Thirty-one percent of respondents, representing 147 organizations, reported having a D&O claim over the last 10 years, up sharply from our 2008 survey, when only 17% reported having a claim in the previous 10 years (Figure 39).

In this most recent survey, nonprofits had a higher incidence of D&O claims, with 35% reporting at least one claim over the past decade. Twenty-nine percent of public companies and 26% of private companies said they had a D&O claim of some kind in the last 10 years. In the 2008 survey, 26% of public companies, 13% of private companies and 16% of nonprofits said they had a D&O claim in the previous decade (Figure 40).

The survey findings suggest that asset size had a direct bearing on the likelihood of a D&O claim. Forty-two percent of companies with more than $10 billion in assets reported a claim, compared to 22% of companies with less than $250 million in assets that reported a claim (Figure 41).

0% 10% 20% 30% 40%

Nonprofits Private Public

All groups (total respondents)

Figure 40. Claims in the last 10 years by ownership

30 30 29 29 26 26 35 35 31% Yes 69% No 31% 00% 00% 69%

Figure 39. Has your organization had any claims against its D&O liability policy during the last 10 years?

0% 15% 30% 45%

$10 billion or more $5 billion to $9.99 billion $1 billion to $4.9 billion $250 million to $999 million Less than $250 million

Figure 41. Claims in the last 10 years by asset size

22 22 28 28 25 25 31 31 42 42

Claims

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0% 10% 20% 30% 40% 50%

Other Regulatory Fiduciary

Employment related

Derivative shareholder/investor suit Direct shareholder/investor suit

Figure 42. Types of claims in the last 10 years

46 46 40 40 30 30 21 21 16 16 15 15

The direct shareholder/investor suit was the most common type of claim, with 46% of respondents reporting at least one such claim in the past decade. Derivative shareholder/investor suits were reported by 40% of the organizations surveyed.

Compared to the 2008 survey, there was a sharp rise in D&O claims across the board. For example, only 18% of respondents reported a shareholder/investor suit in 2008, compared to 46% in 2010. Only 4% reported a derivative/investor suit in 2008, compared to 40% in 2010. And only 5% reported a regulatory claim in 2008, compared to 16% in 2010 (Figure 42). When broken down by ownership, public companies were the target in the lion’s share of direct

shareholder/investor suits (66%) and derivative investor/shareholder suits (65%) (Figure 43).

Figure 43. Types of claims in the last 10 years by ownership

Direct shareholder/ investor suit Derivative shareholder/ investor suit Employment

related Fiduciary Regulatory Other

Nonprofits 7% 7% 67% 19% 19% 26%

Private 29% 7% 45% 16% 13% 19%

Public 66% 65% 13% 26% 19% 8%

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Figure 43. Types of claims in the last 10 years by ownership Direct shareholder/ investor suit Derivative shareholder/ investor suit Employment

related Fiduciary Regulatory Other

Nonprofits 7% 7% 67% 19% 19% 26%

Private 29% 7% 45% 16% 13% 19%

Public 66% 65% 13% 26% 19% 8%

All groups (total respondents) 46% 40% 30% 21% 16% 15%

48 48 47 47 44 44 0% 20% 40% 60% 80% 100% Fiduciary Employment related

Derivative shareholder/investor suit Direct shareholder/investor suit Regulatory 21 21 1616 19 19 23 23 45 45 25 25 23 23

Ranked first Ranked second Ranked third

Figure 45. Rank the following types of claims on a 1 to 5 scale, where 1 is the greatest concern to your organization and 5 is the least concern (top three rankings)

19 19 2626 3333 41 41 1616 1111 10 10 2424 1919 18 18 1515 1818 19 19 1919 12 78 78 68 68 53 53 51 51 50 50 56% Satisfied/very satisfied

24% Neutral, neither satisfied nor dissatisfied

20% Dissatisfied/very dissatisfied

56% 00%00%

24%

20%

Figure 44. How satisfied were you with your D&O insurer’s handling of the claim?

On the whole, most respondents said they were satisfied with the way insurers handled their claims. More than half (56%) said they were satisfied or very satisfied, and 24% said they were neutral. However, one out of five respondents said they were dissatisfied or very dissatisfied, indicating room for improvement (Figure 44).

When asked to rank the types of claims, direct shareholder/investor suits were their greatest concern (41%), followed by regulatory claims (19%) and employment-related litigation (18%).

However, when you consider the top three types of claims of greatest concern overall, regulatory claims ranked first (78%), followed by direct shareholder claims (68%) and derivative claims (53%) (Figure 45). In light of the above findings, clearly one of the fallouts from the subprime and credit crisis is an increased concern over regulatory claims.

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0% 20% 40% 60% 80% 100%

Volume of D&O premium written

Knowledge/understanding of your business Claim-paying reputation

Competitive pricing Breadth of coverage offered Financial strength/A.M. Best rating

21 21 1616 35 35 2323 2222 80 80 32 32 2424 1919 75 75 19 19 2222 2323 6464 6 6 2121 2121 4848 11 11 9 9 2727 4 4 45 45 6 6 25 25 9 9 23 23 7 88

Ranked first Ranked second Ranked third

Figure 46. Rank the following aspects of your primary D&O insurer on a 1 to 6 scale, where 1 is most important and 6 is least important (top three rankings)

7 1 1 1 1

When asked to rank the attributes most important in selecting a primary D&O insurer, 35% of respondents said that financial strength/A.M. Best rating was their most important consideration. Just less than one-third (32%) said that breadth of coverage was their primary consideration. Nineteen percent said competitive pricing was their primary focus (Figure 46).

In our view, although we do not have specific data to draw from in prior surveys, it is likely that the financial difficulties experienced by several large D&O insurers over the past few years played a large role in their focus on financial strength/A.M. Best rating.

The selection criteria related to excess Side A insurers were comparable.

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Liability Survey

Insurance

Market

Summary

Company Contact Capacity (in millions) Comments ABA Insurance Services, Inc. Gina Juhnke, Products Manager

ABA Insurance Services, Inc. 5910 Landerbrook, Suite 100 Mayfield Heights, OH 44124 800-274-5222

e-mail: GJuhnke@abais.com

2010 $15 Writes commercial banks and thrifts.

ACE

ACE Bermuda Jeffrey Jabon

Senior Vice President - Underwriting ACE Bermuda Insurance Ltd. 17 Woodbourne Avenue P.O. Box HM 1015 Hamilton HM 08 Bermuda 441-278-6615 e-mail: jeffrey.jabon@ace.bm web: www.acelimited.com or www.acebermuda.com

2010 $50 All classes. Follow form excess $50 million minimum attachment.

ACE International Ben Ingram, Senior Vice President Nicholas Small

International FI Underwriting Manager ACE International ACE Building 100 Leadenhall Street London EC3A 3BP 011-44-20-7173-7972 011-44-20-7173-7973 e-mail: ben.ingram@ace-ina.com nick.small@ace-ina.com web: www.aceltd.com

2010 $25 ACE International writes

international accounts, excluding U.S.-headquartered corporations, with a capacity of $25 million primary or excess. ACE will consider all classes of accounts, including financial institutions. Local underwriters and local language policy forms in most international countries.

ACE USA Tim O’Donnell, President 2010 $25 All segments and classes of

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CODA

(Corporate Officers & Directors Assurance, Ltd.)

Jeffrey Jabon

Senior Vice President - Underwriting ACE Bermuda Insurance Ltd. 17 Woodbourne Avenue P.O. Box HM 1015 Hamilton HM 08 Bermuda 441-278-6615 e-mail: jeffrey.jabon@ace.bm web: www.acelimited.com or www.acebermuda.com 2010 $75 All classes.

NOTE: Non-indemnifiable coverage only. Primary, excess DIC or follow form excess. Maximum capacity is $75 million, including ACE capacity. Subsidiary of ACE Bermuda Insurance Ltd.

Westchester Specialty Joseph Casey,

President Professional Risk ACE Westchester Specialty 500 Colonial Center Parkway, #200 Roswell, GA 30076 678-795-4258 678-795-4150 (fax) e-mail: joseph.casey@acegroup.com web: www.acewestchester.com 2010 Side A $15 $25

All classes. Wholesale brokers.

AEGIS Karen P. Larson, Vice President

AEGIS Insurance Services, Inc. 1 Meadowlands Plaza

E. Rutherford, NJ 07073 201-508-2804

e-mail: karenlarson@aegislimited.com web: www.aegislimited.com

2010 $35 Utilities, energy, related energy and public power.

Alterra Insurance Ltd. James C. Gray, EVP & CUO Alterra Insurance Ltd. Alterra House 2 Front Street Hamilton HM 11 Bermuda 441-296-8800 441-296-8811 (fax) e-mail: Jim.Gray@alterra-bm.com web: www.maxbermuda.com 2010 Side A $15 $25

Excess AB, ABC, Side A and Side A DIC. No excluded classes.

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American E&S/Specialty London Intermediary for Banks

Denis Brady

American E&S Insurance Brokers 101 California Street, Suite 900 San Francisco, CA 94111 415-445-5040 e-mail: Denis.Brady@aesbrokers.com 2010 Bond $3 $5

Banker’s Professional Liability, Bond, and D&O Coverage designed for community banks, but there are no restrictions on size or type of financial institution.

$3,000,000 Limit on D&O - $5,000,000 Limit on Bond Coverage. Excess limits available upon request. A+ rated security and available nationwide. Arch Insurance

Arch Insurance (U.S.) John A. Rafferty One Liberty Plaza 53rd Floor

New York NY 10006

e-mail: jrafferty@archinsurance.com (646) 563-6364

2010 $25 All classes.

Arch Insurance (Bermuda) Tony Hay, Senior Vice President Underwriting Manager

Professional Lines Arch Bermuda

11 Victoria Street, 4th Floor Victoria Hall P.O. Box HM 129 Hamilton HM 11 Bermuda 441-278-9273 441-278-9276 (fax) e-mail: tony.hay@archinsurance.bm web: www.archinsurance.bm 2010 $25 All classes.

Aspen Insurance Group Fred Cooper Aspen Specialty 2500 Plaza 5 25th Floor Jersey City, NJ 07311 (646) 502-1022 (646) 502-1020 (fax)

2010 $25 • Commercial and Financial Institutions

• Primary and Excess • D&O

• Side A

• Employment Practices • Fiduciary Liability Company Contact Capacity (in millions) Comments

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AWAC

AWAC US (Allied World Assurance Company, Ltd.)

Thomas Kennedy

Allied World Assurance Company 199 Water Street, 24th Floor New York, NY 10038 646-794-0514 646-794-0611 (fax) e-mail: thomas.kennedy@awac.com web: www.awac.com 2010 $25 All classes.

AWAC Bermuda (Allied World Assurance Company, Ltd.)

Ian Theato, Senior Vice President Bermuda & International Professional Liability Manager

Allied World Assurance Company 27 Richmond Road P.O. Box HM3010 Hamilton HM MX Bermuda 441-278-5589 e-mail: ian.theato@awac.com web: www.awac.com 2010 $25 All classes. Axis Capital

Axis Professional LInes John A. Kuhn

Chief Executive Officer Axis Professional Lines Axis Insurance

300 Connell Drive, Suite 2000 P.O. Box 357 Berkeley Heights, NJ 07922-0357 908-508-4302 908-508-4301 (fax) e-mail: john.kuhn@axiscapital.com web: www.axiscapital.com

2010 $25 D&O Insurance and other professional lines coverages for publicly traded and privately held companies of all sizes. Commercial accounts, financial institutions and not-for-profit organizations. U.S. underwriting companies include AXIS Insurance Company, AXIS Reinsurance Company, AXIS Surplus Insurance Company and AXIS Specialty Insurance Company. In the U.S., contact Fred Murnane, Senior Vice President-Underwriting (908) 508-4338 for AXIS Financial Insurance Solutions and timothy. braun@axiscapital.com for AXIS Financial Institutions. International professional lines contacts are hillary.williams@axiscapital.com in Bermuda and dax.gulmohamed@ axiscapital.com in London. Company Contact Capacity (in millions) Comments

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Company Contact Capacity (in millions) Comments Professional Risk Facilities, Inc. Stephen Cavallaro, Underwriting Manager

Professional Risk Facilities, Inc. 1122 Franklin Avenue, 2nd Floor P.O. Box 9240 Garden City, NY 11530 516-408-5736 516-747-6074 (fax) e-mail: scavallaro@professionalrisk.com web: www.professionalrisk.net

2010 $5 All classes except financial institutions and public companies. Underwriting manager/program administrator for AXIS Insurance. Utilizes AXIS Privatus® policy (D&O, EPL, Fiduciary Liability and Outside Executive Liability Insurance), which is admitted in 40 states and written on AXIS Reinsurance Company paper. Non-admitted paper (AXIS Surplus Insurance Company and AXIS Specialty Insurance Company) used in the remaining states. Coverage is also available for not-for-profit organizations.

Beazley Group plc Valerie Baroco Michael Schmitt Specialty Lines Beazley Group

35 East Wacker Drive, Suite 3900 Chicago, IL 60601 312-506-1303 Valerie’s office 312-506-1305 Michael’s office e-mail: valerie.baroco@beazley.com michael.schmitt@beazley.com web: www.beazley.com

2010 $20 Primary or excess for commercial risks. Issuing company: Beazley Insurance Company, Inc.

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Catlin US Catherine Cossu John Van Decker Catlin US 140 Broadway, 43rd Floor New York, NY 10005 212-801-3400 e-mail: catherine.cossu@catlin.com john.vandecker@catlin.com David McDonald James Thomas Catlin US

60 State Street, Suite 1250 Boston, MA 02109 617-316-1207 e-mail: david.mcdonald@catlin.com jim.thomas@catlin.com Stephen McGill Michael Scarlata Catlin US

5700 Canoga Avenue, Suite 130 Woodland Hills, CA 91367 818-577-4100

e-mail: stephen.mcgill@catlin.com michael.scarlata@catlin.com

2010 $15 All classes — both primary and excess.

Catlin Insurance Company Inc. and Catlin Specialty Insurance Company Company Contact Capacity (in millions) Comments

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Chartis

Executive Liability, a division of Chartis

Robert Yellen, Chief Underwriting Officer 175 Water Street New York, NY 10038 212-458-3745 e-mail: robert.yellen@chartisinsurance.com web: www.chartisinsurance.com 2010 $50 All classes. Domestic: Peter McKenna

Division President, Public Company Management Liability (212) 458-1410

Simon Beynon

Division President, National Accounts

(212) 458-1592 Brady Head

Division President, Corporate Accounts

(713) 342-7513 John Gambale

Division President, Private & Non-Profit (212) 458-3198 Brian Benjamin Division President, Financial Institutions (212) 458-2927 International: Anthony Baldwin Senior Vice President, Financial Lines, Chartis International 44-020-7954-8887 Cat Excess Liability,

a division of Chartis

Operating from branches in the U.S., Bermuda and London

William Hopkins, EVP Product Line Manager Cat Excess Liability

175 Water Street, 19th Floor New York, NY 10038 212-458-5887 2010 Max Available Max Preferred $150 $50

All industry classes. Full cover, Side A, Lead DIC

U.S. Domestic and International Company Contact Capacity (in millions) Comments

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Lexington Insurance Company, a division of Chartis

Marc Dodson

Product Line Manager

Management Liability Division Lexington Insurance Company 100 Summer Street Boston, MA 02110-2103 617-235-8012 e-mail: Marc.Dodson@ChartisInsurance.com web: www.chartisinsurance.com

2010 $10 Broad category of financial firms including insurance companies, and REIT’s. Both primary and excess positions.

Chubb Robert C. Cox

Chief Operating Officer Chubb Specialty Insurance 3 Mountain View Road Warren, NJ 07059 908-903-2203

e-mail: rcox@chubb.com web: www.chubb.com

2010 $25 All classes. Chief Underwriting Officer is Jim Bronner, jbronner@ chubb.com; Specialty Products manager is Evan Rosenberg, erosenberg@chubb.com; contact for D&O is Tony Galban, galbant@ chubb.com; contact for Healthcare Institutions is Beth Strapp, strappb@ chubb.com; contact for Financial Institutions is Rich Edsall, redsall@ chubb.com; contact for Private and Not-for-Profit Companies is Michael Maloney, mmaloney@chubb.com. Cincinnati Insurance Co. Scott Unger, Vice President &

Underwriting Manager Cincinnati Insurance Co. P.O. Box 145496

Cincinnati, OH 45250-5496 513-870-2407

e-mail: scott_unger@cinfin.com web: www.cinfin.com

2010 $10 D&O, Fiduciary, EPLI and Cyber (Blue Chip Policy). All classes written on Cincinnati Insurance Co.

NOTE: Only available through our CIC agency force.

CNA

CNA Pro Daniel Fortin

Senior Vice President CNA Pro 333 S. Wabash, 27th Floor Chicago, IL 60604 312-822-5177 e-mail: daniel.fortin@cna.com web: www.cnapro.com 2010 Side A $15 $25

All classes. Contact is Dan

Auslander for all not-for-profit, middle market and private businesses. Contact for financial institutions is Thomas Kocaj. Contact for public commercial firms is Thor Beveridge. Company

Contact

Capacity (in millions) Comments

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Company

Contact

Capacity (in millions) Comments CNA — Nonprofit Community

Homeowner Associations

Adam S. Collins, CIC Assistant Vice President Ian H. Graham Insurance

15303 Ventura Boulevard, 12th Floor Sherman Oaks, CA 91403

818-742-1429 312-381-0593 (fax)

e-mail: adam.collins@ianhgrahaminc.com web: www.ihginsurance.com

2010 $5 MGA for CNA. D&O for nonprofit community homeowner associations, condo associations, commercial associations, timeshares, co-ops, property owners associations and planned urban developments.

CNA — Nonprofit Homes and Services for Aging

Maria B. Moreno Senior Vice President Aon Association Services 1120 20th Street, N.W., 6th Floor Washington, DC 20036-3406 202-429-8553 847-953-0925 (fax) e-mail: maria.moreno@aon.com web: www.aahsa-insurance.com

2010 $5 MGA for CNA. D&O for nonprofit homes and services for the aging including: retirement communities, skilled nursing facilities, assisted living, personal care, independent living/ senior housing, adult day care and other services for the elderly.

Crum & Forster Don Fischer, Senior Vice President Executive Products Division Crum & Forster

Management Protection/Crime & Fidelity Divisions 973-490-6641 973-986-4478 (mobile) 973-490-6965 (fax) e-mail: Don_Fischer@cfins.com web: www.cfins.com

2010 $10 Primary or Excess: D&O / EPL / Fiduciary - public, private, or nonprofit, for virtually all classes other than banks. Standard and/or difficult to place risks. Crime, Miscellaneous Professional and Technology E&O are also available.

Endurance

Endurance Specialty Insurance Ltd.

Robert Needle

Executive Vice President, Professional Lines, Excess Casualty

Endurance Specialty

Wellesley House, 90 Pitts Bay Road Pembroke HM 08 Bermuda 441-278-0464

2010 $25 D&O, E&O, EPLI, Fiduciary, Crime (blended only) on stand-alone, blended or integrated basis. General attachment of $25M for excess. All classes except managed care E&O, insurance brokers E&O and accountants E&O.

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Endurance Risk Solutions, US Joseph O’Donnell Executive Vice President Endurance Risk Solutions 767 Third Avenue New York, NY 10017 212-209-6521

e-mail: JO’Donnell@enhinsurance.com web: www.endurance.bm

2010 $25 D&O, EPLI, Fiduciary and Crime on a stand-alone or blended basis. All classes except financial institutions.

Energy Insurance Mutual Jill Dominguez, ARM

Vice President – Underwriting Energy Insurance Mutual 3000 Bayport Drive, #550 Tampa, FL 33607-8412

800-446-2270 or 813-287-2117 e-mail: jdominguez@eimltd.com web: www.eimltd.com

2010 $50 Industry mutual for utilities and energy services industries. NOTE: Minimum attachment point is $35 million.

Fireman’s Fund Charlotte-Ann Zack, CPCU Assistant Vice President Commercial Risk Management Fireman’s Fund Insurance Company 777 San Marin Drive

Novato, CA 94998-2000 415-899-4622

860-513-3729 (fax) e-mail: czack@ffic.com web: www.ffic.com

2010 $10 Primary only. Private company or nonprofit only.

Great American Jonathan G. Starck

Vice President Marketing Executive Liability Division Great American

1515 Woodfield Road, Suite 500 Schaumburg, IL 60173

630-897-4299

e-mail: jstarck@gaic.com web: www.GreatAmericanELD.com

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The Hartford

Hartford Financial Products Michael Dandini, Senior Vice President Hartford Financial Products

2 Park Avenue, 5th Floor New York, NY 10016 212-277-0750

e-mail: michael.dandini@thehartford.com Steven Boughal, Vice President & Chief Underwriting Officer

Hartford Financial Products 2 Park Avenue, 5th Floor New York, NY 10016 212-277-0436

e-mail: steve.boughal@thehartford.com

The Hartford — Nonprofits Jason Tharpe, Assistant Vice President Aon Association Services

1120 20th Street, N.W. Washington, DC 20036-3406 202-429-8561 847-953-2651 (fax) e-mail: Jason_tharpe@aon.com web: www.npo-ins.com

2010 $5 MGA for Hartford. D&O for nonprofits including: chambers of commerce, foundations, museums and historical societies, miscellaneous nonprofits, social service agencies, and trade & professional associations.

HCC Insurance Holdings HCC Global Financial Products

Andrew G. Stone, President HCC Global Financial Products 8 Forest Park Drive

Farmington, CT 06032 860-674-1900

e-mail: astone@hcc-global.com web: www.hcc-global.com

2010 $25 All classes. Uses U.S. Specialty Insurance and Houston Casualty Insurance paper. International business contacts are Thibaud Hervy, CEO and Philippe Vezio, CEO, Spain (34-93-530-7300).

Professional Indemnity Agency, Inc.

Brian Hickey Senior Vice President

Professional Indemnity Agency 37 Radio Circle Drive, P.O. Box 5000 Mt. Kisco, NY 10549-5000

2010 $10 Capacity available through Houston Casualty Group of companies (admitted in some states) for D&O management liability products for private Company

Contact

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Hiscox Inc. Bertrand Spunberg

Senior Vice President – Management Liability Hiscox USA 520 Madison Avenue New York, NY 10022 978-276-6245 617-515-2361 (mobile) e-mail: Robert.Gadaleta@Hiscox.com web: www.hiscoxusa.com

2010 $15 Primary and excess Not-for-Profit and Private Company management liability products including D&O, EPLI, Fiduciary, Crime, Employed Lawyers as well as Public Officials liability. Coverage offered to most classes of business regardless of size. Licensed or admitted in all states. Admitted primary and excess policies written through Hiscox Insurance Company or State National Insurance Company. Surplus lines primary and excess written on Lloyd’s paper.

Hudson Insurance Group (Odyssey Re)

Jim Hooghuis, CEO & Chairman Hudson Financial Products 176 Mineola Blvd., 2nd Floor Mineola, NY 11501 516-739-7979 e-mail: jhooghuis@hudsoninsgroup.com web: www.hudsoninsgroup.com 2010 Side A $15 $15

Primary, excess and Side A D&O policies for most public company classes including commercial and financial risks of all sizes, REITs and IPOs. Packaged primary (D&O/ EPL/Fiduciary/Crime), excess and Side A policies for private and not-for-profit entities for most classes including healthcare.

ICI Mutual Insurance Co. John T. Mulligan

Vice President – Underwriting Department Manager

ICI Mutual Insurance Group 1401 “H” Street NW Washington, DC 20005 800-643-4246 202-326-5376 (direct) 202-682-2425 (fax) e-mail: mulligan@icimutual.com

2010 $200 Group captive formed by mutual funds and investment advisors. Sponsored by the Investment Company Institute.

IronPro Greg Flood, President

IronPro

One State Street, 7th Floor New York, NY 10004 646-826-6710 646-884-1729 (fax) e-mail: greg.flood@ironshore.com web: www.ironshore.com 2010 Side A $15 $25

D&O all classes and ancillary PTL/EPLI/Fidelity/E&O. Company

Contact

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Liberty

Liberty Insurance Underwriters, Inc./Liberty Mutual Group

Kenia Delgado, Director Howden Insurance 9100 S. Dadeland Boulevard Datran 1, Suite 1500 Miami, FL 33156 786-275-3258 786-228-0521 (fax) e-mail: kdelgado@howdengrp.com web: www.howdengrp.com

2010 $10 MGA for Liberty Insurance Underwriters, Inc. Private company business with total assets of up to $250 million. D&O/EPL/Fiduciary/ Crime/K&R.

Liberty Mutual Group/Liberty International Underwriters

Trevor Howard Senior Vice President Management Liability

Liberty International Underwriters 55 Water Street New York, NY 10041 212-208-4139 212-208-4266 (fax) e-mail: Trevor.Howard@Libertyiu.com web: www.libertyiu.com

2010 $25 Primary and excess management liability products for firms of all sizes, including public D&O, private D&O and not-for-profit D&O; financial institutions D&O / E&O; International D&O; Real Estate Investment Trusts (REITs); Private Equity / Venture Capital; Employment Practices Liability; Pension Trust / Fiduciary Liability; Fidelity coverage.

Lloyds

Markel Insurance Company Salvatore Pollaro Managing Director, Management Liability Markel Insurance Company 708 Third Avenue

New York, NY 10017 212-551-2281

e-mail: spollaro@markelcorp.com

2010 $10 Target Market: Private companies & not-for-profit organizations up to $750M in annual revenues on a primary and excess basis: EPL, D&O, Fiduciary

Publicly Traded Companies up to $2B in Market Capitalization on an Excess basis: EPL, D&O, Fiduciary All classes eligible except Financial Institutions.

Admitted and Surplus paper available.

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National Indemnity (Berkshire Hathaway)

Ajit Jain, President, Specialty Risk Division Berkshire Hathaway 100 First Stamford Place Stamford, CT 06092 203-363-5205 203-363-5221 (fax) e-mail: ajain@berkre.com

2010 $100 All classes. Specializes in large, difficult to place accounts. NOTE: Generally, minimum premium is $1 million.Capacity up to $100 million or more available through negotiations on an individual basis. Navigators Navigators Insurance Company/Navigators Specialty Insurance Company/Navigators Syndicate 1221 at Lloyd’s of London

Christopher Duca, President Navigators Pro

One Penn Plaza, 32nd Floor New York, NY 10119 212-613-4305 212-613-4302 (fax) e-mail: cduca@navg.com web: www.navg.com

2010 $25 All classes. D&O and EPL for publicly traded and privately held firms worldwide. D&O contact is Scott Misson at smisson@ navg.com or (212-613-4214). International D&O contact is Carl Bach, III at cbach@navg.com or 011-44-207-220-6976.

Navigators — Nonprofits Dean Townsend Vice President Victor O. Schinnerer 2 Wisconsin Circle Chevy Chase, MD 20815 301-961-9835 301-951-5444 (fax) e-mail: dean.c.townsend@schinnerer.com web: www.schinnerer.com

2010 $5 MGA for Navigators. D&O and related lines for nonprofit organizations only.

Old Republic Martin Perry, President Chicago Underwriting Group

191 North Wacker Drive, Suite 1000 Chicago, IL 60606-1905 312-750-8800 e-mail: mperry@cug.com web: www.cug.com 2010 Side A $15 $25

All classes. We are interested in technology and life science accounts on a primary and excess; and commercial and insurance company accounts on an excess basis.

OneBeacon Insurance Company

John Chace, Senior Vice President and Chief Underwriting Officer

OneBeacon Professional Insurance 199 Scott Swamp Road

Farmington, CT 06032 860-321-2555 860-321-2890 (fax)

email: Jchace@OneBeacon.com web: www.onebeaconpro.com

2010 $20 D&O and related lines as follows: Healthcare D & O – Hospitals, Managed Care, Long Term Care, Medical Facilities

Not For Profit – Education, Social etc.

Private Company – Small and Large (up to $10M capacity)

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Philadelphia Insurance Companies John W. Glomb, Jr. Senior Vice President One Bala Plaza, Suite 100 Bala Cynwyd, PA 19004 610-538-2602

610-227-0027 (fax) e-mail: jglomb@phlyins.com

2010 $15 Coverage available for nonprofit organizations and private commercial companies. Write both primary and excess.

RLI Insurance Company David Shanosky, CPCU, CPA Executive Products Group RLI Insurance Company 47 Maple Street Third Floor Atrium Summit, NJ 07901 908-598-8375 e-mail: david.shanosky@rlicorp.com web: www.rli-epg.com -or-Chad Berberich

RLI Executive Products Group 909 Lake Carolyn Parkway, Suite 800 Irving, TX 75039

972-677-2116

e-mail: chad.berberich@rlicorp.com

RSUI Group Greg Buonocore, Senior Vice President RSUI Group

945 East Paces Ferry Rd., Suite 1890 Atlanta, GA 30326

404-760-4969

e-mail: gbuonocore@rsui.com web: www.rsui.com

2010 $20 All classes. Company is admitted in 50 states and uses RSUI Indemnity (admitted) paper and Landmark American (non-admitted) paper. Contact person for nonprofit is Michelle Eason. Subsidiary of Allegheny Corp. Contact person for private company business is Mark Hanington.

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Sargasso Mutual Insurance Companies

Wanette M. Vann, Underwriter Sargasso Mutual Insurance Company, Ltd.

Victoria Hall, 11 Victoria Street Hamilton HM 11 Bermuda 441-298-6620 e-mail: wanette.m.vann@marsh.com 2010 Primary Excess Side A Only $15 $20 $20

$15M primary and excess. Up to $20 million in excess coverage available with a minimum attachment of $15 million. Follow form excess Side A only available with limits up to $20M. Coverage is available to eligible U.S. or Canadian domiciled life insurance companies. NOTE: Managed by Marsh Management Services (Bermuda) Ltd.

Scottsdale (Nationwide)

Freedom Specialty Craig Landi

Senior Vice President Freedom Specialty 7 World Trade Center New York, NY 10007 212-329-6901 e-mail:

craig.landi@freedomspecialtyins.com web: freedomspecialtyins.com

2010 $15 All classes of D&O and related lines of business.

Scottsdale Insurance Company

Bernice Holloway, Vice President Negley & Associates

103 Eisenhower Pkwy., Suite 101 Roseland, NJ 07068

973-830-8500 973-830-8585 (fax)

e-mail: bholloway@jjnegley.com web: www.jjnegley.com

2010 $5 MGA for Scottsdale for nonprofit social service agencies and mental health facilities.

Starr Indemnity & Liability Company

Jim Pittinger

Vice President, Financial Lines Profit Center Manager

Starr Indemnity & Liability Company 399 Park Avenue, 8th Floor New York, NY 10022 646-227-6573

917-375-1141 (mobile)

e-mail: james.pittinger@cvstarr.com

2010 $15 Primary and Excess; Public, Private and Not For Profit; Commercial and Financial Institutions.

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Torus US Services Inc. Alex Maza

SVP Head of Management Liability Torus Insurance

5 Harborside Plaza, Suite 2600 Jersey City, NJ 07311

201-743-7765

e-mail: amaza@torusinsurance.com web: www.torusinsurance.com

2010 $10 Management Liability products offered:

D&O, EPL, Fiduciary and Crime – Public, Private, Nonprofit, & Financial Institutions

Appetite:

Target Classes: Consumer products, services, manufacturers, aerospace/ defense, transportation, energy, natural resources, utilities Opportunistic: Hospitality, homebuilders, oil & gas refiners, large technology, pharmaceutical, life sciences, healthcare, specialty retail, casinos, construction.

Travelers

Travelers Cary Meiners

D&O Product Manager Bond & Financial Products Travelers 385 Washington St., Code 9275-NB03 St. Paul, MN 55102 651-310-8938 e-mail: cmeiners@travelers.com web: www.stpaultravelers.com/agents

2010 $25 Considers all classes; primary and excess. Public company liability contact is Bryan Kocon (678) 317-7892; contact for private and nonprofit business is Peter Herron (860-277-1961); contact for financial institutions is Walter Grote (860-277-2208). Issuing paper includes: Travelers Casualty and Surety Company of America, Travelers Excess and Surplus Lines Company, St. Paul Mercury and St. Paul Surplus Lines.

G.J. Sullivan Co. Paul Bubnis, Vice President G.J Sullivan

625 The City Drive, Suite 400 Orange, CA 92868

714-621-2340

2010 $25 Managing General Underwriter for the Travelers Wrap+® for Health Care Organization Directors, Officers and Trustees Liability and Health Care Organization Employment Practices Company

Directors and Officers Liability Survey Summary of Results