Directors & Officers Liability Insurance protects members of the management and senior executives from financial claims of third parties that may arise from decisions or actions taken in the performance of their duties. It covers their personal financial liability in cases of errors, omissions, mismanagement, breaches of corporate and regulatory law, as well as claims from shareholders, employees or supervisory authorities.
In an environment of increased regulatory requirements and heightened scrutiny, D&O insurance is a critical pillar of corporate governance and an essential means of protecting the management team. It helps maintain corporate reputation, limit legal and financial exposures and ensure business continuity.
The insurance solution is tailored to the size, structure and risk profile of each company. Maxima Insurance offers independent assessment of terms, access to specialist international insurance providers and full claims management support so that executives can perform their duties with confidence, transparency and a high level of protection.
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Frequently Asked Questions
Find answers to key questions about the plan and get information before you choose the coverage that’s right for you.
This is the most common confusion. Professional Indemnity covers errors in the provision of services to third parties (e.g. wrong medical diagnosis or technical study). D&O covers errors in the administration and management of the company itself (e.g., poor financial management, violation of statutes).
This is the structure of the policy, which usually includes:
Side A: Immediate coverage of executives when the company cannot or is not allowed to indemnify them.
Side B: Indemnification of the company when the company has already covered its executives.
Side C (Entity Cover): coverage of the company itself as a legal entity, usually for claims related to securities (shares).
The coverage does not only apply to members of the Board of Directors. It includes: General Managers and senior executives. Employees performing administrative duties. Even former executives for actions taken during their term of office.
Customers ask who can “chase” them. Claims can come from:
Shareholders: For a drop in share value or mismanagement.
Employees: For cases of unfair dismissal, discrimination or harassment.
Government authorities: For violations of regulations or legislation.
Creditors & Suppliers: In case of insolvency or bankruptcy.