With an expected surge in securities and derivative litigation fueled by a bear market, Steel City Re says its reputation and ESG insurance products can provide critical strategic protection beyond standard Directors & Officers liability policies.
PITTSBURGH, June 15, 2022 /PRNewswire-PRWeb/ -- With an expected surge in securities and derivative litigation fueled by a bear market – and plaintiffs alleging corporate reputation loss, unsupported ESG promises, and outdated governance models – Steel City Re notes that its reputation and ESG insurance products can provide critical strategic protection beyond standard Directors & Officers liability policies.
Steel City Re's parametric coverage, which is triggered by a failed enterprise level business process and impairment of an insured's Reputation Value Metric, can be used to offset expenses incurred by the board or the enterprise as a whole – that are beyond the coverage of their D&O policies. Steel City Re's policies cover first party losses irrespective of any other property or liability indemnity products.
Also, since Steel City Re's coverage is only available to qualified companies that engage in a robust reputation risk management process, its presence is testimony to the fact that an outside third-party underwriter has validated the company's operations and governance – and put real money behind its own judgement. That validation could prove crucial as the company seeks to tell a simple, credible story of measured ESG promises and dutiful contemporary governance in a court of law and in the court of public opinion.
A recent study by Steel City Re found that public awareness of such reputational risk protection strategies enabled companies to stand out from their peers and boosted their stock prices 5% above the overall market within two weeks – and 9.3% over the subsequent seven months.
On the other hand, companies that failed to institute, validate, and communicate risk management strategies underperformed their peers by an average of 23.3%. Not only did they disappoint the market, they enabled their competitors to capture greater market share.
"Insurance coverage that validates risk management with respect to operations and governance of reputational and ESG activities provides both a 'reputation premium' when markets are stable and a strategic deterrent to litigation when markets collapse," said Steel City Re's CEO Nir Kossovsky. "At the same time, it can supplement D&O coverage by providing companies under fire additional financial resources as they defend their valuable reputations."
About Steel City Re
Steel City Re provides parametric ESG insurance, reputational insurance and helps guide companies' boards and senior leadership in developing enhanced risk governance and management practices. Its underwriting model is supported by more than 7.3 million measures of reputational value and traditional financial metrics that also fuel ESG-focused hedge fund strategies. Its risk governance and management models are informed by principles of behavioral economics.
Media Contact
Steven Alschuler, Steel City Re, 1 9176472151, [email protected]
SOURCE Steel City Re
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