NEW YORK (Bloomberg) – Insurers may end up paying more than $1 billion in claims as US probes of executive stock-option awards trigger widespread shareholder lawsuits, an executive at insurance broker Willis Group Holdings Ltd. said.As many as 300 companies may ultimately face lawsuits costing an average $5 million per policyholder, said Ann Longmore, an executive vice president at the world’s third-largest broker.

Federal investigators are trying to determine whether companies inflated the value of options by backdating or timing grants to coincide with days when stock prices were low.

Lawsuits have been filed against more than 90 companies and at least 176 have disclosed internal or federal probes, according to data compiled by Bloomberg. American International Group Inc. and Chubb Corp. are among the biggest insurers of corporate boards and executives.

Insurers probably “never anticipated that there could be a single practice or a single event that could run across 100 US publicly traded companies,” Longmore said on a conference call yesterday with clients.

The Bermuda-registered and London-based broker helps companies find insurance policies. She didn’t identify any insurers.

A report Longmore prepared earlier this month likened the impact of the options lawsuits to that of so-called “IPO laddering” cases. More than 300 such cases had an average claim of $4 million, she said.

Last week, Martin Sullivan, the chief executive officer of AIG, said most notices of potential claims filed by AIG policyholders involved shareholder derivative suits, which have been less expensive to defend and settle than class-action suits.

“This appears to be a manageable issue for us,” he said.

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