01 / The meaning
What it means.
The insurance product should be distinguished from directors’ and officers’ liability, which is the underlying legal exposure. A programme can provide cover for an individual, reimburse a company that lawfully indemnifies that individual, and sometimes insure defined claims against the entity. These sections need not have identical triggers or breadth, and a shared limit can be consumed by several defendants.
Private companies, associations and other organisations can face management allegations as well as listed companies. The insured-person definition, subsidiary rules and treatment of former directors deserve close attention. Many wordings use a claims-made structure, making prior circumstances, notification dates and continuity important. Defence costs may erode the limit. Insurance does not authorise misconduct, replace governance procedures or override restrictions on what may lawfully be insured.
02 / Put it in context
A practical example.
Hypothetical example: investors allege that a company director misrepresented its financial position. The director and company review who is insured, when the allegation was first made and whether the relevant D&O section may respond.
This example illustrates the term. It does not predict a claim outcome.
03 / Read the detail
What to check.
- Identify individual, reimbursement and entity sections actually purchased.
- Check shared limits, defence costs and applicable conduct exclusions.
- Review prior circumstances, continuity dates and run-off arrangements.
04 / Start a useful conversation
A question for your broker.
Which people and claims would each D&O section address, and who shares the limit?
05 / Connect the terms
Keep the meaning in context.
06 / Apply it to your business
Related insurance guides.
Further reading
Read the source guidance alongside the relevant policy wording.
General information only. This does not take into account your objectives, financial situation or needs. Before acting, consider whether the information is appropriate for you. Cover is subject to insurer acceptance and the policy terms, conditions, limits and exclusions. Read the Financial Services Guide and the relevant PDS (where applicable) and/or policy wording before deciding.
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