Tim Fletcher highlights select top performing 2025 insights produced by the Financial Services Group at Aon.

• SPACs Return: Why D&O Risk Management Must Step Up
  
  

  In 2025, 144 SPAC IPOs raised $30.4 billion and accounted for 39% of total IPO proceeds. Litigation risk around SPACs remains significant. When deals underperform, projections prove too optimistic, or incentives between sponsors, targets and investors are not aligned, business leaders can face shareholder fiduciary duty and securities claims.

  Business leaders can enhance risk management protocols by tightening due diligence, aligning sponsor and board incentives with long‑term investor outcomes, and strengthening governance and disclosure controls. D&O insurance can be used strategically and help leaders manage risk with confidence by setting appropriate limits, structuring towers carefully and securing robust runoff (“tail”) coverage.
  
  

• Nevada Policies Back to Normal: Defense Costs Return to Liability Limits
  
  

  Nevada briefly upended the liability market by banning “defense within limits” policies, raising fears of higher premiums, reduced capacity, and carriers exiting the state. After an uproar, the Nevada Department of Insurance softened the blow with temporary regulations that carved out non‑admitted carriers and most commercial/casualty lines, but market uncertainty remained while everyone waited for a permanent fix. That fix arrived on October 1, 2025, with AB 512, which largely restores the status quo by codifying those carve‑outs and confirming that most commercial policies—including D&O, EPL, fiduciary and cyber—can again be written with defense costs inside the liability limit.
  
  

• The Role of D&O Insurance in Securities Class Actions: From Triggering Events to Claims Resolution
  
  

  Securities class actions usually start with a clear trigger: a stock drop, missed guidance, a restatement, a deal announcement, or a critical event that sparks allegations of misleading disclosure or governance failures. From there, claims tend to follow a familiar path: plaintiff law firm press releases or regulatory inquiries, a filed complaint, motions to dismiss, discovery, potential parallel actions, and, ultimately, settlement discussions and summary judgment.

  D&O insurance is designed to alleviate the financial burdens of a claim. It often can fund the defense from the earliest investigations, protects individual directors and officers when the company cannot indemnify, and helps pay settlements or judgments, subject to policy terms and exclusions. Thoughtfully structured D&O insurance and strong claims advocacy are strategic tools that can shape how well an organization navigates the full lifecycle of a securities class action.
  
  

• SEC Shakes Up Mandatory Arbitration: The Impact for Issuers
  
  

  The SEC has fundamentally changed its stance on mandatory arbitration for investor claims. It will now accelerate registration statements even if an issuer’s governing documents require federal securities claims to go to arbitration, including on an individual (non‑class) basis. The SEC’s focus shifts to one thing: are the disclosures about arbitration clear and complete?

  For issuers, this creates a meaningful, but certainly not risk‑free option to curb class action exposure. State corporate law (e.g. Delaware) may still limit or prohibit these clauses, and investors, proxy advisors and courts will have their own views as well.

  Business leaders should treat mandatory arbitration as a strategic tool. Assess state law constraints, model how arbitration would change your securities claims profile, and, if you proceed, invest in transparent disclosure and carefully drafted provisions that align with your governance strategy and investor base. SEC policy appears to have removed a historic federal roadblock; the decision now sits squarely with issuers, their state law framework and their investors.
  
  

• Executive Orders Create Uncertainty around Employment Practices Risk
  
  

  Recent Executive Orders targeting diversity, equity and inclusion (DEI) programs have created uncertainty for employers, especially federal contractors and grant recipients. Several orders seek to terminate federal DEI programs, require certifications that contractors are not running “illegal DEI programs,” and encourage investigations into private-sector DEI initiatives. Parts of these orders are already tied up in court, leaving organizations caught between shifting federal expectations and existing anti-discrimination duties under Title VII and state laws.

  Another order targets the use of “disparate impact” as a theory of liability, pushing agencies to roll back rules, investigations and consent decrees that rely on it. While that may blunt some federal enforcement, it doesn’t eliminate private or state-law exposure. The Executive Orders introduce ambiguity, but thoughtful governance, legal guidance and well-structured EPL insurance can turn this period of change into a chance to modernize employment risk management.
  
  

The Financial Services Group at Aon is pleased to curate relevant and timely insights, and we will continue to monitor developments in financial and executive risks. Our content center contains hundreds of relevant and timely insights. If you have any questions about your coverage or are interested in obtaining coverage, please contact your Aon broker.