Pricing for directors' and officers' liability insurance decreased 2.7 percent in the third quarter of 2009 compared to the rates seen in the third quarter of 2008, according to Aon's third quarter Quarterly D&O Pricing Index. The Pricing Index is designed to provide directors, officers and risk managers of publicly traded corporations with a better understanding of current and historic D&O pricing conditions.

Aon said that following double-digit increases in each of the previous four quarters, D&O pricing for the Standard & Poor's financial institutions sector, which includes banks, diversified financials, insurance and real estate, increased by only 3.2 percent in the third quarterof 2009, reflecting a 39 percent drop from its highest point in 2003. According to the Index, D&O pricing for all remaining S&P industry sectors was down an average of 4.9 percent in the same time.

D&O claims and pricing tend to move in the opposite direction of the financial markets. When a company's stock is doing well, shareholders are typically content. Thus, as the stock market has recovered this year, the frequency of claims has slowed. In the first three quarters of 2009, there were 130 federal securities class action lawsuits filed, 49 related to the credit crisis. This marks a 20 percent decrease from the 163 filings seen during the same period in 2008.