ABSTRACT
D&O liability insurance forms part of the complex area of professional indemnity insurance and as such deals with three main areas of cover: the director’s own liability to third parties as a result of a breach of contractual or fiduciary duties or actions amounting to a tort and defence costs which the director himself or the company may incur as a result of legal proceedings concerning liability under the preceding sub-paragraph. It also include: reimbursement of the company in respect of any indemnity paid in advance to its directors. A working definition of D&O cover often may be found in the insuring clauses of such policies. Insuring clauses of the type set out above provide indemnity against claims for losses arising from wrongful acts committed by the director acting in his capacity as such. Once the insured has complied with their notification obligations, coverage under a claims made policy is triggered on a contingent basis.
