Protect your company’s leaders with directors and officers liability insurance
Due to heightened accountability, directors and officers require robust liability insurance to safeguard their personal assets and organizational stability against potential legal claims.
Invest in D&O coverage to ensure the future success of your business
Directors and officers (D&O) liability insurance is specifically crafted to protect individuals who may be personally sued for alleged wrongdoing while serving in their leadership roles. This insurance not only covers defence costs but also any settlements or judgements that directors, officers, and the organization might be required to pay. By ensuring the security of your leadership team, you are investing in the long-term resilience of your business.
Comprehensive liability coverage for evolving risks
D&O policies are uniquely designed to address a broad range of potential claims, including:
- Errors, misstatements, or misleading statements
- Acts of omission or neglect
- Attempted or committed breaches of duty
These risks can arise unexpectedly and impact not only individuals but also the reputation and financial security of your entire organization. Having a robust D&O policy in place empowers your leaders to make critical decisions with confidence, knowing that they are protected against unforeseen legal challenges.
Tailored commercial solutions for your peace of mind
It’s absolutely vital to rely on experienced advisors who understand the complexities of liability coverage and are committed to negotiating the ideal terms, conditions, and policy structure to suit your needs. With professional guidance, you can rest assured that your coverage is comprehensive, leaving no gaps that could compromise your protection. This proactive approach not only demonstrates your commitment to good governance but also inspires confidence among stakeholders and investors.
Working with experienced advisors makes selecting effective D&O liability insurance straightforward.
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Common features of D&O policies
Although coverage and options for directors and officers (D&O) policies can differ significantly between insurers, there are three standard clauses typically included:
Side A Insured Clause
Provides direct payment to directors and officers for losses that are not reimbursed by the organization.
Side B Insured Clause
Reimburses the organization for expenses incurred while defending and supporting its directors and officers.
Side C Insured Clause
Covers losses sustained by the organization itself when it is sued alongside its directors and officers.
Why choose Acera Insurance for directors & officers liability?
When it comes to protecting your leadership team, the decisions you make about D&O insurance are crucial. Navigating the complexities of directors & officers liability coverage can be overwhelming, but at Acera Insurance, we are committed to guiding you through every detail. Our experts don’t just sell policies; they take the time to understand your organization’s unique risks, ensuring you receive a tailored solution that genuinely safeguards your directors and officers. You won’t have to worry about missing important coverage or overlooking potential gaps. Our advisors will clarify all options and help you determine the precise protection you require.
Decades of Experience
Trust is earned through experience. Acera Insurance brings decades of proven success in protecting directors and officers across public, private, and non-profit organizations. Our in-depth knowledge means we understand the nuances of policy structure and negotiation, so you can be confident your coverage is robust and reliable.
Custom Solutions
No two organizations are alike. That’s why we work with over 100 insurers and specialty underwriters to deliver customized D&O insurance programs. Our team ensures your policy addresses your organization’s specific exposures and needs, so you can rest assured knowing your directors and officers are protected by a policy built just for them.
National & Global Capabilities
Whether your organization operates locally, nationally, or internationally, Acera Insurance has the reach and resources to support you. Through our extensive networks and strategic alliances, you gain access to skilled insurance and risk management professionals across Canada and around the world.
Helpful tips from our advisors.
Our Acera Insurance advisors work directly with you to create custom solutions that protect your operations. Our approach includes identifying, analyzing and evaluating your exposures to make proactive decisions for mitigating or preventing risk.
Answering your most common questions.
What time period does the D&O policy cover?
The policy will cover any claims made and reported to the insurer during the policy period provided there was no prior knowledge of any circumstances that could lead to a claim. Extended reporting options may be available if the policy is not renewed.
Are there geographical restrictions for coverage under a D&O policy?
Most D&O policies provide worldwide coverage, meaning the policy will respond to claims regardless of where in the world they arise. However, organizations may still require local insurance policies depending on where they operate. Certain countries require locally-admitted insurance be purchased and taxes to be paid per local legislation in order for a claim to be paid out within the country.
Who is covered under a D&O policy?
Past, current, and future directors and officers of a company and its subsidiaries.
What are some common allegations that require D&O coverage?
Allegations that are most commonly made and which have to be defended by directors and officers include:
- Acting beyond the scope of their authority
- Giving wrong or unprofessional advice
- Breach of fiduciary duties
- Failure to supervise subordinates or company affairs properly
- Authorizing excessive company spending
- Unauthorized company borrowing
When are these allegations most likely to occur?
These are most likely to occur following:
- Foreign investment (especially in the US)
- Acquisitions or divestitures
- Management buy-outs
- Public offerings
- Reduced dividends
- Mergers
- Waste or mismanagement of corporate assets
- Change in ownership of the company’s share capital
- Liquidation of the company
- Employee dismissal
- Boardroom disputes
- Breach of contract
What do D&O policies exclude?
Common exclusions include:
- Fines and penalties
- Fraud
- Bodily injury or property damage
- Pending or prior litigation
- Illegal remuneration or personal profit
- Claims made by shareholders
- Claims made by directors and officers against other directors and officers
- Nuclear incidents
- Claims covered by other insurance
What happens to the coverage following a merger or acquisition?
Although exact language will vary, there is usually a provision stipulating that if the organization undergoes a merger or acquisition during the policy period, the policy coverage is then limited to wrongful acts that occurred prior to the merger or acquisition date.
D&O run-off coverage can be purchased to protect against claims made after this date.
Aren’t directors and officers covered by their company’s indemnification agreement?
Directors and officers have indemnification agreements with the corporations they serve, but this is of no use if the corporation becomes insolvent. Also, the corporation may not be lawfully permitted to indemnify. Allegations of fraudulent and malicious acts will negate the corporate indemnity.
What are the duties imposed on company directors?
The Canada Business Corporations Act and numerous statutes in each province impose many duties on the company director. Some impose liability without any negligence by the director or officer (i.e. unpaid wages or taxes).
There are further duties established by common law and any breaches that lead to financial loss to the company, shareholders or others can be grounds for legal action. Whether the individual is actually found at fault or not, substantial defence costs can be incurred.
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