Directors and Officers Insurance

The cost of Directors & Officers Insurance will vary based on risk factors such as organization type and industry.

The following factors are typically taken into consideration when determining the cost of your premium:

• Organization Type and Size
• Training and Experience
• Number of Employees
• Annual and Projected Revenue
• Past Claims History
• Quality Control Procedures

A D&O Insurance policy is structured based on which combination of insuring clauses (i.e., the scope of coverage) make up the policy. A standard policy typically includes two clauses – A and B – and sometimes C. 

• Side A – Directors & Officers Liability: Protection for director’s and officer’s personal assets if the company cannot fund indemnification.
• Side B – Company Reimbursement: Reimbursement for legal expenses incurred when a company defends its directors or officers.
• Side C – Entities Security Coverage: Extended coverage for public companies, for securities claims only.

Public companies commonly purchase ABC policies; whereas, non-profit and private companies are more likely to buy an AB policy. 

Organizations with large limits over $30M are more likely to require an ‘extra-layer’ policy structure, whereby a group of insurers shares the risk.

Multi-national corporations need an international insurance solution to protect their executives in global markets. A multi-national solution typically includes a global master policy supplemented by locally admitted policies to provide comprehensive coverage.