Nicola Sharp of business and finance legal specialists Rahman Ravelli underlines the importance of companies being properly insured.

There are fears among insurance underwriters that the COVID-19 pandemic will prompt a wave of major litigation claims.

With premiums for directors' and officers' liability insurance (known as D and O insurance) showing a huge increase in the second quarter of this year, the insurance industry is braced for a vast number of claims related to the virus.

D and O insurance protects company directors and executives against litigation costs. Reports have stated that premiums for companies that are viewed as being especially exposed to pandemicrelated legal claims have risen by up to 2,000%. With hundreds of claims having been brought in the US against companies accused of spreading COVID-19, there is the expectation that a similar legal activity will be seen in the UK. Lloyd's of London estimates that £76 billion will be paid out in claims related to COVID-19 this year.

The figures being disclosed reflect the inevitability of civil litigation increasing in the UK and around the world as a result of the pandemic. With this increased litigation comes a vast increase in the financial pressure on D and O insurers. This, in turn, highlights the need for companies to ensure that they have strong protection in place.

As there is no way that COVID 19 could have been anticipated, it would be unfair to scrutinise companies to assess how prepared they were. But the pandemic has underlined the need for companies, directors and officers to make sure that they have adequate insurance coverage in place for all types of litigation that may come their way

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