Aon launches new D&O Risk Analyzer to support U.S. public companies

Aon plc (NYSE: AON), a leading global professional services firm, has launched its latest innovation: the Directors and Officers (D&O) Risk Analyzer. This advanced digital application is designed to help risk managers at U.S.-listed public companies make informed, data-driven decisions to mitigate executive risks.

The D&O Risk Analyzer is part of Aon’s commitment to enhancing risk management through technology and analytics. It addresses the increasing complexity of corporate officer risks due to factors such as rising litigation and defense costs, market volatility, and evolving regulatory requirements.

Timothy Fletcher, CEO of Aon’s Financial Services Group, emphasized the importance of this new tool. “Rising litigation and defense costs, equity market volatility, and shifting regulatory frameworks have added complexity for corporate officer risks,” Fletcher said. “It is more important than ever for risk managers to assess D&O liability and the role of insurance in protecting public officers and board directors. Our D&O Risk Analyzer, together with Aon’s brokers, provide a holistic analysis of the D&O risk landscape, helping clients make better decisions.”

Key Features of Aon’s D&O Risk Analyzer

The D&O Risk Analyzer offers several critical features designed to enhance risk management for public companies:

Real-Time Analytics: This feature provides immediate, data-driven insights into potential D&O losses. Clients can evaluate risk retention and transfer options, with models that adjust in real-time based on new information, offering updated risk assessments as circumstances change.

Risk Exposure and Loss Models: The tool includes detailed models to help clients and brokers understand their exposure to adverse events, ranging from minor issues to catastrophic impacts. It analyzes factors such as stock volatility, liquidity issues, and regulatory matters that drive D&O litigation.

Stock Price Drop Analysis: This capability evaluates how varying stock price declines could impact theoretical D&O losses. Using historical settlement data, the tool provides a comprehensive view of potential risks associated with stock market fluctuations.

Total Cost of Risk (TCOR) Visualizations: The D&O Risk Analyzer visualizes all potential insurance options, enabling clients to explore and optimize their insurance programs. This feature helps in making informed decisions about coverage limits and insurance value, ensuring clients can effectively communicate these decisions to their stakeholders.

These features allow for real-time forecasting of losses and risk exposures, fostering detailed discussions between risk managers and brokers about the extent of potential risks. This capability empowers risk managers to better convey risk retention and transfer options to senior executives.

Expanding Risk Management Capabilities

The introduction of the D&O Risk Analyzer follows the recent releases of Aon’s Property Risk Analyzer and Casualty Risk Analyzer. These tools also leverage data-driven insights to assist clients in managing their property and casualty risks. Aon plans to release additional risk analyzers in the coming months to cover more key risk areas.

Joe Peiser, Global CEO of Commercial Risk Solutions for Aon, highlighted the firm’s commitment to innovation in risk management. “Aon’s D&O Risk Analyzer exemplifies our firm’s dedication to helping clients make data-informed decisions,” Peiser said. “As the risk landscape grows more complex, we will continue to provide actionable analytics solutions that enable our clients to confidently assess risks and insurance offerings.”

Enhancing Risk Management with Data-Driven Insights

Aon’s latest tool is a significant advancement in the realm of risk management technology. By offering real-time data, detailed risk models, and comprehensive insurance options, the D&O Risk Analyzer helps U.S. public companies navigate a complex risk environment more effectively. This tool is set to transform how risk managers approach executive risks and insurance decisions, contributing to more strategic and informed risk management practices.

Aon’s commitment to integrating technology with risk management is evident in its continuous development of innovative tools designed to meet the evolving needs of its clients. As the risk landscape continues to change, Aon remains at the forefront, providing solutions that enhance decision-making and optimize risk management strategies.