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Online expansion intros new financial risks

Joanne Carew
By Joanne Carew, ITWeb Cape-based contributor.
Johannesburg, 08 Aug 2012

Online expansion intros new financial risks

The latest Executive Risks Boardroom Guide from the Willis Group warn that, as the online universe expands, it has “introduced new financial risks that may not be covered under general and professional liability insurance, including standard directors' and officers' (D&O) policies, reports Insurance Journal.

“As a result, corporate directors and risk managers must ensure that they buy appropriately tailored policies that provide protection against the rapidly expanding risks to which they are vulnerable, both personally and professionally.”

Willis explained that in 2011, “companies of all sizes struggled with 'cyber incidents,' ranging from malicious intrusions to employee negligence. Indeed, big corporations are not the only ones that are vulnerable to hackers. Half of all US companies that have experienced data breaches have fewer than 1 000 employees.”

With risk management now a key boardroom concern, Willis' latest publication, Executive Risks: A Boardroom Guide, explores the range of risks and responsibilities that accompany the role of a director, Market Watch writes. It provides up-to-date information to help educate and inform directors about the many risks they face.

Written by Willis and a collection of global law firms, the Boardroom Guide focuses on legal developments for directors in 18 key jurisdictions around the world and also has six special focus chapters addressing issues with global reach.

According to Claims Journal, elsewhere in the report, and commenting on overall market dynamics, Willis said that the global D&O insurance market has grown in capacity, while a number of new insurers have entered the market for international excess.

The effect of this has been to keep pricing of D&O insurance relatively stable in most areas, despite the economic turmoil and the heightened threat of litigation.

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