Directors' and Officers' Insurance:
Leaders' Liability Cover

If you are a company director or hold some other senior leadership position, then getting a competitive directors' and officers' insurance quote from Coversure could be a shrewd business decision. Directors' and officers' cover protects a business and its key personnel should they be held liable for their actions and end up being sued. For example, if you or one of your senior colleagues were accused of negligence, financial reporting errors or having provided poor or misleading advice as part their role, then D&O would be there to help fund your defence of the claim and cover any potential compensation payments.

Which Companies Need D&O Insurance?

Historically D&O cover was intended just for large businesses with turnovers in the tens of millions and with similarly high liability risks. Over time however, as we have become a more compliance-heavy world and as recourse to the courts has risen, so it has become a policy that is being picked up by small and medium-sized businesses too. And with good reason: a 2017 report from Business Insurance reported that cases had reached a 20-year high while the Financial Times has reported a rising trend in litigation of this kind since the financial crash of 2008.

What Can Directors' and Officers' Insurance Protect Against?

With D&O cover you can rest assured that you're covered from an array of potentially costly risks, such as;

Employment practices and human resource issues
Failure to comply with regulations or laws
Negligence or failure to carry out their job adequately
Financial/other company reporting errors
Inaccurate or inadequate disclosure
Misrepresentation in a prospectus
Claims arising from Investors or shareholders who blame directors personally for either losses or a lack of satisfactory returns
Inaccurate or inadequate disclosure (e.g. in company accounts)
Decisions exceeding the authority granted to a company officer – in other words someone taking an action that they were not allowed to

Examples of such claims include;

A slander allegation was made by a customer against a company owner following an argument at a meeting. Having D&O protection in place, the company was able to avoid court action by making a payment that was covered by the policy
Investors in a replacement window manufacturer sued a company's directors for losses incurred by them overstating the financial position of the business
A worker was sacked for gross misconduct after assaulting a colleague at work and for bringing the company into disrepute. The employee sued for unfair dismissal saying he was provoked. The case failed and the business was able to claim back the legal expenses it incurred defending the case

Who Can Directors' And Officers' Insurance Cover?

While that may sound like a silly question, D&O is a flexible policy that can cover more company members than you might think;

An unrestricted definition of directors or officers covering all types of past, present and future directors (executive and non-executive) and officers
Managerial and supervisory employees who aren't board-level directors
All employees for employment-related wrongful acts
Employees as co-defendants
Retired directors other than those retired because of disqualification from holding office
Outside directors who, at the request of the company, serve on an outside entity board