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Q4 2024 FINPRO Management Liability: Need to Know

In this issue, we look ahead to kidnap, ransom, and extortion risks that organizations are expected to face in 2025.

Every quarter, our management liability team shares noteworthy trends and emerging issues to help US-based companies make decisions to manage their risks. In this issue, we look ahead to the directors and officers (D&O) liability, employment practices/wage and hour liability, fiduciary liability, and kidnap, ransom, and extortion risks that organizations are expected to face in 2025.

Our Q4 2024 issue focuses on:

  • D&O updates on understanding and mitigating the complex risks associated with AI, regulatory changes, climate strategies, cybersecurity threats, and shareholder activism.
  • The implications of recent judicial rulings and new regulations for employment practices liability, particularly regarding the integration of AI in hiring, emerging pay transparency laws, and the implications of recent Supreme Court rulings on workplace discrimination.
  • For the fiduciary liability group, organizations face increasing challenges under ERISA, including lawsuits over the handling of plan forfeitures, healthcare plan fees, cybersecurity measures, pension risk transfers, and tobacco surcharges.
  • Related to kidnap, ransom, and extortion, organizations must identify and mitigate evolving risks, including potential changes in US policies under the incoming administration, increasing threats against organizations, a rise in attacks on AI systems, shifting geopolitical dynamics, and the need for enhanced safety measures for executives in light of recent events.

Top risks by line of coverage

Directors and Officers Liability

1. The rise of AI
2. Evolving regulatory environment
3. Climate strategies
4. Cybersecurity threats
5. Shareholder activism

Employment Practice Liability

1. The game-changing impact of AI in employment
2. The future of pay transparency laws
3. The US Supreme Court’s influence on employment law
4. The Pregnant Workers Fairness Act
5. Diversity, equity, and inclusion

Fiduciary Liability

1. Use of plan forfeitures
2. Healthcare plan fees
3. Cybersecurity
4. Pension risk transfer liability
5. Tobacco surcharge

Kidnap, Ransom, and Extortion

1. Uncertainty surrounds the US ahead of administration change
2. The race to AI and digital threats
3. Geopolitical uncertainty
4. Workplace violence and assault

Download the full newsletter

To learn more about the risks that organizations may face in 2025 and the mitigation strategies to counter these challenges, download our Q4 2024 FINPRO Management Liability: Need to Know.

As organizations face these multifaceted risks, they must implement comprehensive mitigation strategies, including:

  • Enhance corporate governance
    It is important for organizations to take action to strengthen their corporate governance frameworks by promoting transparency in decision-making processes and fostering a robust culture of compliance throughout the firm.
  • Update cyber incident response plans
    Companies must align their incident response strategies to new regulatory requirements, while also taking proactive action to prepare for potential cyber threats.
  • Prioritize ethical use of AI
    As AI technologies become integral to hiring and recruitment, employers should implement measures to ensure that these technologies are used ethically. This includes maintaining human oversight, ensuring transparency in AI algorithms, and providing training to mitigate risks of discrimination.
  • Stay informed and adapt to regulatory changes
    In an evolving legal and regulatory landscape, it is important to stay ahead of changes. Engaging with insurers and demonstrating compliance with legal standards can help organizations navigate potential liabilities effectively.
  • Evaluate and review insurance coverage
    Organizations should work with their insurance advisors to assess whether their insurance limits are adequate for emerging risks. This includes confirming that coverage extends to any new roles and addressing potential liabilities related to shareholder activism.
  • Monitor current events and security threats
    It is important to constantly evaluate the risk landscape to identify potential threats stemming from current events and take action to protect key individuals within the organization. 

Our people

Placeholder Image

Kate Maybee

Fiduciary Liability Product Leader

La'Vonda McLean

La'Vonda McLean

Employment Practices Liability/Wage & Hour Product Leader, FINPRO

Ruth Kochenderfer

Ruth Kochenderfer

Product Leader, D&O

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