Directors’ and officers’ (D&O) insurance covers a business’ directors and officers (key managers) for the costs of compensation claims for alleged wrongful acts. This can include breaches of trust or duty, neglect, misleading statements and wrongful trading.
Directors’ and officers’ insurance is recommended for companies which have directors or officers. If the directors and officers of a company do not have appropriate insurance, they are at greater risk of being unable to defend themselves against:
- disqualification from holding the position of director;
- civil proceedings which can lead to extensive legal costs and damages; and
- criminal prosecution, leading to fines or imprisonment.
D&O insurance can cover claims made against a company’s directors and officers by regulators, shareholders, investors, creditors, employees and other parties for:
- breach of duty
- negligent acts, errors or omissions
- defamation committed in good faith
- accidental misstatement or misleading statements
- employment-related breaches or negligence
- claims brought in relation to insolvency or breaches of European legislation
It does not cover claims brought against a company as a whole, only claims made against individuals for alleged wrongdoing in their capacity as directors or officers.
Contact us to find out more or to get a free, no-obligation quote.
Covers can vary so always read your policy documents carefully.