2013 on track for lowest number of D&O-related actions in years

The number of new securities and business litigation and enforcement actions so far this year put 2013 on track to have the lowest annual total since before the credit crisis, according to a new report from Advisen Insurance Intelligence.

The second quarter of this year had a 41% decrease in new lawsuits and enforcements actions that could be covered under directors and officers policies, according to the report, D&O Claims Trends: Q2 2013.

That’s the largest quarterly decline since before the financial crisis in 2007/2008, and if the current rate of decline continues, this year could have the lowest total filings since 2006.

Securities fraud and breach of fiduciary duty filings were the most common kind of actions in the quarter, according to the trend report.The financial services sector accounted for 25% of the total, it added.

The number of settlements did increase slightly during the quarter, but the settlement values dropped, the report also said. The average settlement for the quarter was $37.2 million, down from $69.3 million in Q1, it noted.

Events in Q2 involving non-U.S. companies, filed in the U.S. and elsewhere, accounted for 15% of the total events on average, four points higher than Q1, according to the report.