This calculator provides rough figures for budgeting purposes only. Details must be reviewed by independent insurance consultants such as our team.
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Start getting tailored D&O coverage right away anywhere in the world, simply by paying an upfront fee with our technical team reaching out to you within 24hrs. Lowest cost for similar protection is contractually guaranteed.
You can also schedule DeshCap's Free Demo Call showing you how we change and trigger directors and officers insurance policy language for best cost, compliance, operational protection, financing, and valuations. Our team is independent of any insurance broker or lobbyist, working for you and not the insurer, and has skin in the game during claims.
DeshCap is ranked online #1 worldwide for Liability Risk, which includes hedging it through products such as Directors and Officers Liability Insurance.
Directors and Officers Insurance Explained
D&O insurance is a hedge against a specific set of loss scenarios related to liability risk, it is also known as Directors and Officers Liability Insurance or Management Liability insurance. It provides financial protection for the individual directors and officers of an organization as well as the organization itself as a legal entity in case of liability tied around any alleged or actual mismanagement of the organization. One important consideration is that the organization and its directors and officers may not be at fault but can still be subject to lawsuits or monetary demands that are frivolously launched against them.
Key Notes of Directors and Officers Insurance
- The construct of Directors and Officers Insurance (D & O insurance) is around 95% Operational and 5% Legal;
- The average payout ratio on D&O Insurance is < 25% if not reworded by independent experts;
- D&O insurance protects an entity and its subsidiaries and directors and officers against certain Liability Risk;
- The role of insurance brokers prohibits them from being active in a claims process and having skin in the game.
D&O Risk
It is important to measure the D&O risk an organization faces at least annually, which includes measuring the probability of occurrence of D&O risk as well as its impact amount if the risk were to materialize. The final impact amount would have to be adjusted for D&O Insurance that is purchased and the extent to which such insurance protects individual directors and officers, as well as the organization itself. The following illustration shows how D&O risk measures are dynamic and can be changing constantly even if the underlying operations have not changed. D&O insurance must be updated accordingly.
It is important to note that D&O insurance cost will vary based on the entity's D&O risk:
- D&O insurance cost public company: it is best to budget 0.25% to 5% of the D&O limit or protection amount
- D&O insurance cost private company: it is best to budget 0.05% to 3% of the D&O limit or protection amount
- Cost of D&O insurance for nonprofits: it is best to budget 0.03% to 2% of the D&O limit or protection amount
Please refer to the Section 'Cost of D&O Insurance Explained' for further details, or contact us to procure directors and officers insurance at the lowest cost contractually guaranteed.
D&O Insurance Market Updates
While D&O insurance premiums have been trending upwards for the last couple of years, there seems to be more entrants and competition amongst insurers which could relieve some of the cost pressure on insureds. The D&O insurance coverage sold by insurance brokers is becoming more restrictive as insurers put on various coverage exclusions to the D&O insurance policy (ex. exclusions on cyber losses that lead to lawsuits against directors or officers).
History Of D&O Insurance
D&O stands for directors and officers. D&O insurance was created right after the 1929 economic crash because many company directors and officers at that time were being subject to lawsuits due to their companies’ failures. Such individuals had to incur out of pocket expenses to defend themselves and to settle lawsuits against them. The insurance industry saw it as an opportunity to create a new product of which objective would be to financially protect the individual directors and officers in case they were brought to court or faced any sort of litigation.
With that said, the breadth of coverage offered by D&O insurance today is very different than what it was back in the 30s. The product went through various changes and evolved around meeting regulatory requirements as well as requirements from directors and officers themselves or their legal representatives given past experiences and court rulings. Part of the evolution was also due to increased competition within the insurance industry amongst insurance brokers and companies leading to more offerings in terms of what D&O insurance would cover. For example, it is now standard practice for D&O insurance to protect the company, as a separate legal entity, that is represented by the individual directors and officers, which was not the case back in the 30s. With that in mind, let's dive deeper into what D&O insurance covers.
What Does D&O Insurance Cover?
There are three main coverage sections within a typical D&O insurance policy:
1. D&O Side A coverage, which offers protection for Ds and Os in case they are targeted or named in a lawsuit all while their company is either unable or unwilling to indemnify them for associated costs;
2. D&O Side B coverage, which offers protection for Ds and Os in case they are targeted or named in a lawsuit however while their company is able and willing to indemnify them for associated costs;
3. D&O Side C coverage, which offers protection for the company itself as a legal entity in case it is targeted or named in a lawsuit whether alongside individual directors and officers or not.
It is important to note that financial protection includes defence costs, indemnities, as well as other expenses, and the insurance policy should clearly define the types of expenses that are covered as well as how they are paid by the insurance company along with a timeline for such payment. Note that the policy itself will have various definitions, exclusions, and terms and conditions impacting coverage, it is therefore of high importance for the policy to be analyzed word by word and reworded in order for relevant loss scenarios tied to liability risk to be covered, as opposed to loss scenarios that cater to an insurance company’s original intent of the wording. Also note that each insurance company uses its own terminology whether in the form of insurance policy section titles, definitions, or exclusions and other terms. This typically adds confusion to insurance brokers as well as the buyers.
More on Directors and Officers Insurance Coverage
D&O Liability And Claims
D&O liability risk entails hundreds if not thousands of loss scenarios. It is therefore important to focus on what is relevant to the organization and its Ds & Os. Loss scenarios that can be protected against or claimed under a D&O insurance policy include monetary demands, legal investigations, or lawsuits from:
· Shareholders (including Derivative suits)
· Creditors
· Governments
· Clients
· Employees
· Service providers
· Law firms representing plaintiffs (including class action lawsuits)
The large majority of D&O claims are a result of poor financial performance.
An example of a claim that should have resulted in the D&O insurance paying out is that of Goldman Sachs directors reaching a settlement of $79.5 million to end the 1MDB shareholder suit in 2022.
Does D&O Insurance Cover Former Directors?
YES, it does. However just like any desired coverage it is important to ensure that it is clearly stated within the insurance policy. Many D&O insurance policies would cover past directors for up to three or four years from them having left the insured company.
Does D&O Insurance Cover Employees?
Let’s break down this question into two parts.
Part 1 is the question of whether an employee of an entity that gets sued will be protected under a D&O insurance policy. The answer is YES, the policy should certainly include employees as part of the definition of Insured or Insured Persons since this can easily be done by many insurers and is standard practice for them. Each insurance company has their own way of wording the D&O insurance policy, so it is important to review it word by word.
Part 2 is the question of whether Ds & Os would be covered under a D&O insurance policy in the event of a lawsuit brought about by an employee. The answer is IT DEPENDS. Various insurance companies include employment practices liability insurance coverage as an add-on to their D&O insurance coverage, so buyers should make sure of such add-on if they want employment related suits covered. That said, it is equally important to analyze the wording provided by the employment practices liability insurance coverage in order to ensure desired coverage is met.
Is Cyber Liability Covered Under D&O Insurance?
This depends on the wording of the D&O insurance policy. It is important to make sure that the policy is reworded to include relevant loss scenarios of the buyer which could include cyber liability scenarios. Beware of policies that include cyber coverage as an extension of coverage in return for a minimal premium charge. This is done to lure buyers however the wording of the policy would not actually protect against any meaningful forms of cyber losses.
What Does D&O Insurance Not Cover?
Here are some items that most D&O insurance policies will not cover:
· A loss that happens before an agreed upon retroactive date of the policy
· A fraud or malicious conduct that is proven to be intentional
· A loss that can be covered under a different type of commercial insurance policy (ex. pollution liability, bodily injury, property damage, etc.)
· An insured legally pursuing another insured under the policy
D&O Insurance Exclusions
It is important to note that exclusions within a D&O insurance policy differ from one insurance company to another even though there are some common exclusions that are standard within the insurance industry as mentioned above. The point is that each exclusion should be reviewed and/or reworded in order for the D&O insurance policy to be tailored to the buyer’s profile. This can only be done when the insurance coverage is reviewed to match the specific relevant loss scenarios of the buyer. What happens most of the time is that the buyer takes the advice of an insurance broker who is compensated to sell the D&O insurance policy, and even though some brokers show buyers that they are able to amend the insurance through endorsements, most of the time such endorsements have no real statistical impact on the core liability risk faced by the directors and officers as well as the entity itself.
Important D&O Insurance Policy Definitions
The following are keywords that are found in the Definitions section of a D&O insurance policy and that should be analyzed in conjunction with the buyer’s needs:
CLAIM; WRONGFUL ACT; LOSS; DAMAGES; INSURED.
It is important to review and/or reword any other definition introduced by an endorsement to the policy that directly impacts coverage for a core risk relevant to the buyer. Do not forget to ask your insurance broker for a copy of the complete wording including all endorsements, you can also have our team audit those here.
Cost Of D&O Insurance Explained
The annual premium associated with a D&O insurance policy depends on various factors including the nature of the company whether it is a not-for-profit, a private company, or a public company, as well as the size of the company, the industry it operates in, the complexity of its shareholder base and organizational charts, as well as its financial and operational performance. The breakdown of the cost of D&O insurance is more or less the same as that of the cost of business insurance in general.
Typically, directors and officers insurance cost is lowest for small not for profits or small private firms with few shareholders. However, keep in mind that the D&O insurance cost varies by country, and in the U.S. it may also vary by state. It is helpful to calculate D&O insurance cost in terms of percentage of the D&O insurance limits. Get the lowest D&O premiums with DeshCap given our cost contractual guarantees.
For example, if the insurance limit is $1,000,000 and the annual premium is $10,000 then the directors and officers insurance cost would be expressed as 1%. This enables an easier comparison and benchmarking process across industries and geographies. D&O insurance cost in Canada is less, on average, than that in the US; it is not unusual to see the D&O premium as a percentage of the limit of liability be less than 0.1% for a CAD 1 million limit of liability in relation to organizations that are deemed to be the least risky exposure to insurance companies.
The cost of D&O insurance varies depending on the size and type of company, as well as the specific coverage options selected. It can be purchased as a standalone policy or as part of a broader package of insurance coverage. Typically if a company is paying over 1% in premium to insurance limit it is considered to be in the expensive range made for high risk businesses.
D&O insurance cost will be the lowest in countries where lawsuits are not common practice, or where the judicial system is not independent or caps the amount of damages, assuming the same level of competition amongst insurance brokers and companies.
There are also advanced methods to benchmark the cost of directors and officers insurance, which is most useful to mid-sized and large organizations. These methods involve the opportunity cost of self-insuring the D&O risk, which can incorporate bank financing rates. Feel free to contact us for queries or even an indication of your organization's directors and officers insurance cost.
D&O Insurance Cost Indications
Get the lowest D&O insurance cost for existing insurance with us as we offer worldwide cost contractual guarantees. Contact us for a quick indication of your D&O insurance cost with minimal information required. For your reference, here are ranges of D&O Insurance Cost stated as a percentage of D&O insurance limit:
- Nonprofit D&O Insurance Cost: 0.03% to 2%
- Private D&O Insurance Cost: 0.05% to 3%
- Public D&O Insurance Cost: 0.25% to 5%
Note that these ranges are rough indications serving as a quick guide to D&O Insurance cost. Actual D&O insurance cost and premiums may deviate from such ranges depending on the D&O risk in question. Note that the cost of officers and directors insurance refers to the same ranges.
How Much D&O Insurance Do I Need?
The limit of liability that is adequate for a specific organization and its directors and officers is one that is based on risk quantification which includes factors inherent to the organization as well as external factors such as past litigation outcomes. In many instances organizations are told by insurance brokers that they need to carry X amount of limit of liability because of their client benchmarking. However, this methodology of choosing the limit of insurance is inherently flawed because buyers usually follow their budgets or their brokers’ advice even though such advice is not data driven nor based on science, so in essence the benchmarks themselves are flawed.
A good rule of thumb is to take the limit of insurance as a percentage of the company's assets or revenues depending on which figure is most appropriate vis a vis the industry it operates in. For example, for an asset manager, using Assets Under Management (AUM) to provide a quick benchmark for the D&O insurance limit is of better use than using the balance sheet asset figure. 1% of AUM or $1 million whichever is lower is typically the starting point for D&O limits for asset managers. The 1% of AUM rule of thumb can be used as a very quick way to get a ballpark figure of the D&O insurance limit up to an AUM of $1 Billion. Above the latter threshold, the correlation between AUM and D&O insurance limit breaks down.
It is highly recommended for any buyer to take the advice of risk experts who are independent of insurance brokers or companies when it comes to choosing the amount of insurance that they would need to buy.
D&O Liability Insurance vs E&O Insurance
D&O Liability insurance is meant to cover losses that stem out of alleged or actual mismanagement of a specific company. Whereas E&O insurance, also known as professional liability insurance, is meant to cover losses that stem out of alleged or actual negligence in the course of providing a service to clients. In fact, the majority of D&O policies exclude E&O type claims.
Think about Liability Risk as having hundreds if not thousands of loss scenarios (ie. an entity can be sued for many different reasons, and each of these reasons constitutes a specific loss scenario). There is no single insurance product that would hedge against all loss scenarios. Instead, insurance companies offer different products, each of which can be used to cover a specific set of loss scenarios if structured and managed correctly.
D&O Insurance For Financial Institutions
Financial Institutions (FIs) are different from a risk management standpoint because their Operational Risk has a high correlation with their financial risk, whether it’s credit risk, investment risk, or market risk, depending on the type of financial institution (ex. Operational Risk in Banks). Since Liability Risk is a part of Operational Risk, the former naturally has a higher correlation with financial risk as it relates to financial institutions. That is why the D&O insurance cover for FIs should be analyzed, reworded, and managed by independent risk experts with advanced financial backgrounds, and using a different set of tools than would otherwise be used for D&O insurance provided to non-FIs. In addition, D&O insurance for venture capital firms must contemplate portfolio company D&O risk and can be incorporated within IRR. The same applies to D&O risks and insurance for private equity firms.
D&O Insurance For Public Companies
Since public companies that are listed on an exchange entail a broader type of Liability Risk, the D&O insurance cover should similarly be reworded to include a broad range of loss scenarios that are more relevant to publicly traded companies such as:
· Higher odds of class action lawsuits
· The public rallying of investors by law firms looking to profit from suing the company
Typically, an abrupt downward swing or a persistent downward trend in a company’s stock price would prompt law firms to rally investors for a class action lawsuit against the company. That is why D&O insurance for public companies requires deeper analytics and attention.
D&O Insurance For Private Companies
While frequency and severity of D&O claims are less for private companies than public companies, there is a wide range of D&O insurance offerings for private companies depending on the size and nature of the business being insured. In many jurisdictions private company D&O claims are mostly triggered by employment claims (ex. employees suing directors, officers, and the company itself for workplace issues whether driven by compensation, harassment, wrongful termination, or other). It is therefore not uncommon to see many insurers tie employment practices liability insurance to their D&O insurance coverage offering in one policy.
D&O Insurance For Nonprofits
Since nonprofits do not have shares, the securities risk within the D&O risk of a nonprofit is nonexistent, which makes D&O insurance for nonprofits one of the most profitable lines of business within commercial insurance as a whole. Like most private companies, most nonprofits would primarily see D&O claims arise from employment practices (ex. harassment suits, wrongful dismissal, etc.).
D&O Insurance Online Quote
Buying D&O insurance from an online broker should be restricted only to those organizations that are looking to check the box for certain regulatory requirements or contractual obligations. This is because there will be no or little opportunity to reword the D&O insurance policy for it to be meaningful from a risk management standpoint when buying from online sources.
For organizations that are keen on risk management including compliance, which is yet to be automated, it is best to go through a risk expert who is independent of any insurance broker or company. If you are looking for a D&O quote, feel free to contact us.
D&O Insurance Providers
Contact us if you are looking for the right D&O insurance providers wherever your business is domiciled. There are many D&O insurance providers but choosing the right one is a difficult and time consuming task. Not choosing the most appropriate D&O insurance providers can cost your business a lot of money and risk. There are international D&O insurance providers (ex. AIG, Chubb, Allianz, etc.) or regional or local D&O insurance providers. They typically use their agents and/or brokers, including online platforms, to sell their off the shelf insurance.
D&O Insurance Broker
Contact us if you are looking for a D&O insurance broker. We can assign you the right D&O insurance broker anywhere in the world as there are millions of insurance brokers around the world who can get you a D&O quote from one or more insurance companies. However, it is important to have the right broker. Moreover, buying D&O insurance directly through a broker without having the insurance reworded by independent risk experts will result in a low insurance payout when a large loss happens. It will also be expensive. Also keep in mind that having D&O insurance brokers compete for your business is a good thing as it minimizes your cost. We always have several brokers bid on our clients' D&O insurance or other commercial insurance. Note that a D&O insurance broker is not active in a claims process.
D&O Limit Benchmarking
Limit benchmarking within the insurance marketplace is flawed and should not be relied on by businesses. This is because the benchmarking does not take into account the specific risk factors of each individual business that is included within the benchmarking data set. Businesses should choose their D&O limits based on their own operational risk factors, including but not limited to the industry in which they operate, their size, operational controls and processes, financial condition, and organizational charts. Such operational risk factors impact the probability of occurrence and severity of a specific D&O loss scenario related to the organization, and that is why D&O limit benchmarking provided by brokers should not be relied on.
D&O Lawsuit Coverage
A D&O policy can cover a range of different types of lawsuits brought against individual directors/officers or the organization itself or any of its related entities, which includes payouts for defence costs, indemnities, and other expenses incurred throughout a lawsuit. It is important to reword the policy that gets sold by a D&O insurance broker to effectively cover the loss scenarios that are relevant to the organization (as opposed to those that the insurance company wants to cover). Insurance Risk, aka basis risk, which is the risk of the insurance not paying out as expected, is a real issue within D&O coverage. It is therefore important to minimize such insurance risk and be aware of the business insurance claims process, which many business and investors tend to overlook.
D&O Insurance by Country
- United States: as one of the most litigious countries in the world coupled with the fact that D&O insurance has originated there, the U.S. dominates D&O insurance penetration rates and spend relative to other countries. The market offers a wide variety of D&O coverage options sold through broker and agents. Independent consultants are also most active in the US.
- Canada: all publicly listed companies in Canada are required to carry D&O insurance and the product is therefore well known to executives. The magnitude and frequency of D&O claims in Canada is much less than in the U.S.
- Australia: thought to be one of the most litigious countries in the world, D&O insurance is a well established product in Australia.
- United Kingdom: also highly litigious relative to most other countries, the UK is home to one of the largest pools of D&O underwriters and brokers in the world.
- Other countries: the dynamics of D&O insurance, including structure, coverage, and cost, change from one country to another.
Directors and Officers Liability Insurance Quote
Factors to consider when obtaining Directors and Officers Liability Insurance quotes
When obtaining D&O insurance quotes, there are several key factors to consider to ensure you get the right coverage at the best price:
- Policy limits: The policy limits, or the maximum amount the insurer will pay for covered claims, is a critical factor. Higher limits will provide more comprehensive protection, but they will also come with a higher premium.
- Deductibles: The deductible, or the amount the insured must pay before the insurance coverage kicks in, can also impact the premium. Lower deductibles typically result in higher premiums, while higher deductibles can lower the overall cost of the policy.
- Coverage exclusions: It's important to carefully review the exclusions in the policy, as they can limit the scope of coverage. Some common exclusions include intentional acts, criminal or fraudulent conduct, and claims related to pollution or environmental issues.
- Reputation and financial stability of the insurer and broker: When comparing quotes, it's essential to consider the financial strength and reputation of the insurance provider. You want to ensure that the insurer will be able to pay out claims if needed.
- Industry-specific considerations: Certain industries, such as financial services or healthcare, may face unique risks that require specialized D&O coverage. Be sure to choose a policy that is tailored to your industry's needs.
- Company size and structure: The size and complexity of your organization can also impact the D&O insurance coverage you require. Larger companies with more complex structures may need higher limits and more comprehensive coverage.
By carefully considering these factors, you can ensure that you obtain the right D&O insurance coverage at a fair and competitive price. Contact us for a directors and officers liability insurance quote or a quick cost estimate.
Comparing Directors and Officers Liability Insurance quotes
Obtaining D&O insurance quotes can be a straightforward process, but it's important to approach it in a strategic and organized manner. Here are the steps to follow:
- Gather the necessary information: Before reaching out to insurers, gather all the relevant information about your organization, including its size, industry, financial performance, and any previous claims or litigation history.
- Identify potential insurers: Research and identify several reputable insurance providers that specialize in D&O coverage. You can start with your existing insurance broker or agent, or look for providers that have experience in your industry.
- Request quotes: Contact the brokers and request D&O insurance quotes. Be prepared to provide the information you gathered in step 1, as well as any specific coverage requirements or preferences your organization may have.
- Compare the quotes: Once you've received the quotes, carefully compare them side-by-side. Look at the policy limits, deductibles, coverage exclusions, and the overall premium to determine which option provides the best value.
- Evaluate the insurers and brokers: In addition to the quote details, consider the financial stability and reputation of each insurance provider. You want to ensure that the insurer you choose will be able to fulfill its obligations if a claim is made.
- Negotiate and finalize the policy: Once you've identified the most suitable option, you can negotiate the terms and conditions with the insurer to ensure you're getting the best possible coverage at a fair price.
By following this process, you can obtain multiple D&O insurance quotes and make an informed decision that protects your organization and its key decision-makers.
Common misconceptions about Directors and Officers Liability Insurance quotes
Despite the importance of D&O insurance, there are several common misconceptions that can prevent organizations from obtaining the coverage they need. Understanding and addressing these misconceptions can help ensure that you make the best decision for your company.
- "My company is too small to need D&O insurance": This is a common misconception, as companies of all sizes can face lawsuits and claims against their directors and officers. Even small and medium-sized businesses can benefit from the protection provided by D&O insurance.
- "Our organization is not at risk of litigation": While some companies may feel that they are not at risk of legal action, the reality is that the business landscape is becoming increasingly litigious. Lawsuits can arise from a wide range of issues, from financial mismanagement to employment practices, and no organization is immune.
- "D&O insurance is too expensive": While D&O insurance can be a significant expense, the cost of not having coverage can be much higher. The legal fees and potential settlements or judgments associated with a lawsuit can quickly exceed the cost of a D&O policy, putting the personal assets of directors and officers at risk.
- "Our general liability or other business insurance policies will cover D&O-related claims": This is a common misconception, as general liability and other business insurance policies typically do not provide the same level of protection as a dedicated D&O policy. These policies may have exclusions or limitations that leave directors and officers vulnerable.
- "Our organization's bylaws or indemnification agreements will protect our directors and officers": While these measures can provide some level of protection, they are not a substitute for D&O insurance. Lawsuits can still be filed, and the organization may not have the financial resources to fully indemnify its directors and officers.
By understanding and addressing these misconceptions, you can ensure that your organization is adequately protected and that your directors and officers have the coverage they need to make informed decisions without fear of personal financial consequences.
Tips for selecting the best Directors and Officers Liability Insurance provider
Choosing the right D&O insurance provider is crucial to ensuring that your organization and its key decision-makers are properly protected. Here are some tips to help you select the best provider:
- Look for experience and expertise: Choose an insurance provider that has extensive experience in the D&O insurance market and a proven track record of providing high-quality coverage to organizations in your industry.
- Evaluate financial stability: Ensure that the insurance provider you choose is financially stable and has the resources to pay out claims if needed. Check the provider's financial ratings and review its financial statements.
- Consider the policy features: Carefully review the policy features, including the coverage limits, deductibles, and exclusions, to ensure that they meet the specific needs of your organization.
- Prioritize customer service: Look for an insurance provider that offers responsive and personalized customer service, as you'll likely need to work closely with them in the event of a claim.
- Seek out tailored solutions: Some insurance providers may offer specialized D&O insurance products that are tailored to the unique needs of your industry or organization. These customized solutions can provide more comprehensive protection.
- Negotiate the terms: Don't be afraid to negotiate the terms of the D&O insurance policy, such as the coverage limits or deductibles, to ensure that you're getting the best possible value.
- Consider the policy's flexibility: Look for a D&O insurance provider that offers flexible policy options, such as the ability to adjust coverage limits or add additional insured parties as your organization grows and evolves.
By following these tips, you can ensure that you select the best D&O insurance provider for your organization, giving you the peace of mind that your directors and officers are properly protected.
Case studies showcasing the importance of Directors and Officers Liability Insurance
The importance of D&O insurance is often best illustrated through real-world case studies. Here are a few examples that highlight the critical role this coverage can play in protecting directors, officers, and the organizations they serve:
- The Enron scandal: The collapse of energy giant Enron in the early 2000s resulted in numerous lawsuits against the company's directors and officers, alleging financial mismanagement and fraud. Without adequate D&O insurance coverage, the personal assets of these individuals were put at risk, leading to significant financial hardship.
- The Wells Fargo account scandal: In 2016, Wells Fargo faced a barrage of lawsuits and regulatory actions after it was revealed that employees had opened millions of unauthorized customer accounts. The D&O insurance coverage helped the company and its directors and officers navigate the legal and financial fallout, providing crucial protection.
- The Volkswagen emissions scandal: When Volkswagen was caught manipulating emissions tests, the company and its executives faced a wave of lawsuits and investigations. The D&O insurance coverage helped the company manage the legal and financial consequences, ensuring that the personal assets of its directors and officers were not put at risk.
D&O liability can stem from any type of operational risk including fraud risk as was the case with the Wirecard fraud. The above case studies underscore the importance of having robust D&O insurance coverage in place, as even the largest and most established organizations can face unexpected legal challenges that can threaten the personal finances of their key decision-makers. By investing in this type of coverage, companies can protect their directors and officers, allowing them to make strategic decisions without fear of personal liability.
D&O Insurance FAQ
D&O Insurance Policy
The D&O Insurance Policy is divided into several sections and incorporates the application signed by the insured as well as written correspondence confirming the insured's data on D&O risk, the declarations pages summarizing coverage, the main policy wording, and any endorsement that alters the main policy wording. This follows more or less the same policy structure as any liability business insurance. Various insurers use a modular D&O insurance policy whereby the main policy wording is divided into sub wordings, each respecting a specific coverage that can be tagged onto the wording outlining general terms and conditions, which governs all sub wordings.
Directors and Officers Insurance Brokers
Please refer to the section titled 'D&O Insurance Broker'. There are many brokers who can distribute directors and officers insurance. These can range from local to international brokers. We make several of them compete against each other in order to produce best cost outcomes to our clients.
Cost of Officers and Directors Insurance
The cost of officers and directors insurance varies greatly depending on the nature of the organization being insured alongside the protection amounts and the type of coverage sought (ex. small D&O insurance limits can cost less than $1,000 for non-profit organizations whereas large limits for public companies can cost hundreds of thousands, or millions, of dollars). Pleaser refer to the section above titled 'Cost of D&O Insurance Explained' for further details or use our D&O Insurance Cost Calculator for basic guidance.
What Is Directors and Officers Insurance
It is insurance protecting directors, officers, and the organization itself from a claim resulting from a Management Act. Pleaser refer to the section above titled 'What does D&O Insurance Cover?' for further details.
Directors and Officers Liability Insurance
This is the same as directors and officers insurance or D&O insurance or D&O Liability Insurance. Various terminologies are used to describe the same product. Please refer to the section right above.
D and O Insurance
See above as there are many variants describing the principle of D and O Insurance.
D & O Insurance
See above as there are many variants describing the principle of D & O Insurance.
D and O Insurance Quotes
SMEs or larger entities looking for D and O insurance quotes can contact us. We are independent of any D and O insurance broker or lobbyist and can contractually guarantee the lowest D and O Insurance Cost for similar protection. Our team makes D and O insurance brokers compete to get you the best D and O insurance quote, as well as rewords and triggers the D and O insurance policy for best results. We can also audit any D and O insurance quotes that Management has already sourced from brokers or insurers. Our AI-based independent insurance audit utilizes world leading commercial insurance analytics.
Directors and Officers Insurance Quote
Contact us as outlined in the section right above to get a quote independent of brokers, insurers, or lobbyists for best value to the organization.
D&O Insurance Quote
Please reference the above query. Getting a quote for D&O insurance follows the same general principles as quotes for business insurance.
Directors and Officers Insurance for Nonprofits
See the section above called D&O Insurance for Nonprofits. Nonprofits have a unique D&O risk profile due to no share structure.
D & O Insurance Not For Profit
See above as the term D & O insurance not for profit is simply a variant of Directors and Officers Insurance for Nonprofits or D&O Insurance for nonprofits.
How to Get D and O Insurance
Contact us to get D and O Insurance that meets your cost, compliance, and protection goals. We make corporate insurance brokers compete for your business to minimize your D&O Insurance Cost in addition to using filed expert negotiation techniques with D&O brokers.
Directors and Officers Insurance name variations
What we reference as D&O insurance can have several name variations online including but not limited to the following, however all such variations refer to the same commercial insurance product: Directors and Officers liability insurance, directors & officers liability insurance, directors & officers liability, directors and officers liability, D&O liability insurance, Directors and Officers insurance, directors & officers insurance, management liability insurance, D & O insurance, directors liability insurance, directors insurance, director and officer insurance, dno insurance, d and o insurance, etc.
Disclaimer
This content is independent of any content coming from insurance brokers, companies, or lobbyists. Commercial insurance is rarely taught in schools, and when it is it’s mostly done through the lens of brokers or insurers. There are many misconceptions around D&O Insurance, just like many topics in commercial insurance, due to bad habits acquired through over reliance on insurance brokers or insurers or information providers who are lobbied by them. Suing the insurance company to enforce coverage defeats the purpose of buying insurance, so Management should make sure that their D&O insurance pays out fast on large losses. In addition, insurance terminology is not standardized, which may add to confusion. Our D&O insurance case study provides a real life example of how, at a basic level, the insurance can be reworded for better compliance and protection, all at a lower net cost.