Directors and officers liability coverage is not uniformthroughout the world, and insurance purchased for a multinationalfirm in the United States does not necessarily extend to othercountries, brokerage executives said.

Their comments were delivered during a Marsh brokerage seminaron "The New Reality of Risk."

Nick Foord-Kelcey, a managing director of Marsh and head ofD&O practice in Europe, and Stuart Hill, an attorney with thelaw firm Lovells LLP in London, said not all nations recognizenonadmitted D&O coverage and a close reading and understandingof local requirements is necessary to make sure executives have theright coverage where they work.

In some countries, said Mr. Foord-Kelcey, there are also taxpayments required on premiums and subsidiaries may have to figurewhat proportion of premium paid on a policy applies.

The coverage issue does have an exception in the European Unioncountries, he added, where purchase of a D&O policy in Londondoes extend itself to other members of the Union.

Mr. Foord-Kelcey and Mr. Hill underscored the importance ofD&O coverage overseas, noting that regulations and changes inthe perception of the legal requirements of corporate executives toboth their employees and shareholders are making litigation morepopular, though still not at the level seen in the UnitedStates.

However, the definition of D&O responsibility is expandingand evolving, noted Mr. Hill.

He pointed to the British definition of responsibilities ofcorporate officers. For years, those definitions were based oncommon law and were codified in 2006. Under more recentdefinitions, he said the law appears to cover corporateresponsibility for the impact of the company's practices on peopleand the environment.

He said corporations may now be held as "catalysts for socialand environmental change," and that may also open the doors toincreased litigation.

Diana Diffendarfer-Clark, senior vice president, Marsh'smultinational practice, advised companies "to prepare yourself forconflicting information on the surface regulatory analysis," notingthat the information they get from an insurer may be different fromthe country's regulator.

Companies need to seek professional advice and examine deeplyindividual nations' regulatory environment, understand the rules,and even work up hypothetical loss scenarios to determine how thecoverage will be played out.

Eugene "Tripp" Sheehan, Marsh's national D&O practiceleader, who moderated the discussion, said U.S. companies oftenassumed in the past that the purchase of a D&O policy coveredclaims made around the world, but that is no longer the case.

This new reality does not confine itself to D&O but alsoextends to other coverage including errors and omissions, fiduciaryliability, employment practices liability and fidelity, Mr. Sheehansaid.

A replay of the session is available online atwww.marsh.com.