Directors & Officers Liability

Directors & Officers Liability

Directors and officers (D&O) liability insurance is insurance coverage intended to protect individuals from personal losses if they are sued because of serving as a director or an officer of a business or other type of organization. It can also cover the legal fees and other costs the organization may incur because of such a suit.

Need for D & O Liability Insurance

Directors and officer’s liability insurance is akin to corporate governance, corporate law, and the fiduciary duty owed to stakeholders, such as shareholders and beneficiaries. Publicly traded companies are subject to more federal regulation than privately held companies; hence it is necessary to protect the senior management from any possible lawsuits.

Sometimes their decision can result in financial losses and they can be held personally liable and could be involved in an expensive lawsuit. Directors and Officers insurance helps businesses in making decisions and not worrying about any such legal liabilities.

“WRONGFUL” – In the Directors and Officers Liability Insurance context, “WRONGFUL” means; any actual or alleged misrepresentation, misstatement, misleading statement, error, omission, defamation, negligence, breach of warranty of authority or breach of duty means.

What’s Covered?

D&O Insurance policy reimburses the financial loss arising because of a legal suit on individual directors & officers while discharging their fiduciary duties for the company. Broad coverage includes the following –

  • SIDE A – Coverage to protect individual directors & officers for defence costs, judgements if the company does not indemnify them.
  • SIDE B – Reimburse the company for indemnification of the individual director & officer.
  • SIDE C – Coverage against securities claim on the company.

More Specifically, it covers a wide range of risks such as –

  • Regulatory Investigations
  • Accounting Irregularities
  • Exposures relating to mergers & acquisitions
  • Vulnerability to shareholder / stakeholder claims.
  • Employment practice violations including harassment, discrimination, wrongful termination.
  • Securities claims, those related to shareholder value.

What’s not covered?

  • Fines, penalties and claims for seepage or pollution.
  • Excluded territories/jurisdiction.
  • Claims for bodily injury, property damage.
  • Known acts prior to inception.
  • War & nuclear risks.
  • Waiver of subrogation.
  • Criminal acts, libel, slander or other defamations and professional liabilities e.g. architects, managers, etc.
  • Major Shareholders Exclusion: Any claim brought by major shareholders having more than stipulated % of the voting stock or by any security holder unless the security holders without instigation and totally independent of major shareholders brings about the claim.
  • Pending and Prior litigation exclusion.
  • Entity EPLI and Entity Security claims (except if covered as an extension).
  • Auto acquisition of subsidiaries with an asset size of more than stipulated %.
  • Environmental liability & ADR claims originating from US/Canada.

Why Us?

At Emedlife we have superior claims handing capability and are present across India. We have local expertise, understanding of the D & O product and work with various insurance companies to extend you the best suited D & O insurance policy.

Talk to us today for all your D & O liability insurance needs at an affordable price and for reliable claims management.

For registration of claims and to learn more about our claims process please Contact our dedicated claims team for advice on an incident/claim.

D&O Policy protect company director or officer from legal liability arising out of actual or alleged wrongful acts in managing a company.

  1. The policy covers a wide range of litigation that could arise from customers, vendors, shareholders, employees.
  2. In addition to defence cost, it provides cover for :
  3. Investigation Cost
  4. Entity Protection against Employment Practice Liability claims
  5. Outside Entity Directorship cover,etc.


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