Geopolitics is becoming an increased liability insurance risk among global company directors and officers, according to a report from WTW and Reed Smith.
The Global Directors’ & Officers’ Liability Insurance Survey found that 59% of respondents ranked geopolitical risks as one of their top seven concerns – the first time it has entered the rankings. Respondents in Europe were more likely to flag geopolitics as a risk, as were businesses with between $50m to $1bn in annual revenue.
Health and safety-related concerns remained the top insurance liability risk (77%), followed by data loss (76%) and cyber attacks (75%) – the same top three as in 2025.
William Thoms, an underwriter at AWAC, told WTW: “The first appearance of geopolitical risks in the top seven risks emphasises the heightened focus of boards on global instability and the need to balance this with a desire for continued growth and profitability.
“For D&O underwriters, understanding how these evolving concerns affect our clients’ operations remains a key priority alongside assessing the governance frameworks and risk management controls implemented in response.”
While it didn’t feature in the top seven risks, AI concerns also remain elevated, with 56% of respondents flagging AI risk as ‘very important’ or ‘extremely important’. Half of respondents said AI-generated errors and misinformation was the principle AI risk, followed by AI-enabled fraud and social engineering (40%) and strategic failure to adopt AI (38%). Misrepresentation of AI capabilities was only flagged as a risk by 15% of respondents.
Luca Ravazzolo, an underwriter at Zurich Insurance Company, told WTW: “The relatively low ranking of misrepresentation of AI capabilities is noteworthy given recent D&O litigation trends. For example, in the US, AI-related disclosures have become a leading driver of event-driven securities class actions, with allegations typically focusing on misrepresentation of capabilities, revenue attribution or inadequate disclosure of associated risks.”
When it comes to operational resilience, 39% of respondents cited increased risk exposure in areas such as supply chain and third parties as the most concerning impact, followed by lack of resources and cross-functional engagement (18%) and lack of strategic data and technology (17%).
Emma Pereira, an underwriter at Beazley told WTW: “New regulatory regimes such as DORA [and] CSRD are putting more pressure on directors. These frameworks are driving a more controls-based approach on director accountability, elevating the risk exposure for board members.
“As a result, operational resilience, data integrity and reporting accuracy are becoming more prominent areas of concern for insureds.”
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