Insolvency Claims Against Directors, Officers to Increase, Expert Warns

While many have celebrated the start of the New Year filled with hope, one expert believes that 2021 will be difficult for directors, officers, and their advisers due to a projected increase in insolvency claims against them, Insurance Business Magazine reported. “The view from specialists across our network is that while legislative measures… have offered some protection to directors of companies facing financial difficulties, insolvency claims will be a strong driver of D&O risk in 2021,” said Simon Konsta, partner at Clyde & Co. London. Konsta also noted in a statement that as the number of COVID-19-related insolvencies rises, the next 12-18 months will likely see more claims against solicitors, accountants, auditors and property professionals. Aside from anticipating a surge in insolvency claims, Konsta also compared current conditions to the last global financial crisis of 2008. According to the expert, current companies and the professionals that advise them are “definitely better run” now than in 2008 thanks to tougher regulator regimes. But at the same time, businesses now face raised expectations – and the public will not hesitate to find someone to blame if those expectations are not met. Read more.