Directors & Officers Insurance
Protect your leadership team's personal savings and assets from costly legal actions.
Directors and officers (D&O) insurance can protect the personal savings and assets of your leaders when they are personally sued over decisions they made running the organization, such as not living up to their duties, making misleading statements, mismanagement, or a run-in with regulators. It pays the legal defence and any settlement those claims bring.
Every decision your directors and officers make can be second-guessed by customers, employees, investors, and government regulators. If someone believes a decision hurt them, they can sue, and your leaders' own money can be on the line. This coverage protects your leadership, makes it easier to recruit strong people to your board, and is a key part of protecting the business.
Who Should Consider D&O Insurance?
Any organization with a board or executives should carry this coverage. It applies just as much to private companies and non-profits as to public companies.
- Public companies with investors and regulatory obligations
- Private companies with a board or advisory committee
- Non-profit organizations with volunteer or appointed directors
- Startups trying to attract experienced board members
- Any organization whose leaders make decisions that affect others
What can be covered?
Not Living Up to Their Duties
Claims that a director or officer failed to meet their legal duties to the organization.
Misleading Statements
Claims over misleading statements, reporting problems, or inaccurate disclosures.
Employee Claims
When included or added on, claims from employees such as wrongful dismissal, discrimination, or harassment.
Run-ins With Regulators
Legal defence for claims and investigations that your leaders broke a rule or regulation.
Investor Lawsuits
Defence against lawsuits from shareholders or members who say a decision cost them money.
Legal Defence Costs
Legal fees, settlements, and court awards, which help protect your leaders' personal money.
Coverages shown are general examples, not a description of any specific policy. Policy coverages widely vary and should be confirmed with your broker.
Attract and Retain Strong Leaders
Without this coverage, capable people may hesitate to join your board because their own money could be at risk. The right policy lets your leaders make confident decisions knowing they are protected. Coverage generally extends to past, present, and future directors and officers of the organization.
How Pricing Works
What drives your premium
- What kind of organization you areA public company with shareholders and disclosure obligations is the most expensive to insure, a private company sits in the middle, and a small non-profit is generally the least. All three face real claims.
- Your financial healthRevenue, assets, debt, and whether you are profitable. Financial trouble is the single strongest predictor of a claim against directors, because creditors, investors, and members come looking when money is lost.
- How many people you employWhere the policy includes employee claims like wrongful dismissal, discrimination, and harassment, headcount and your HR practices matter, and for smaller organizations these are usually the claims that actually arrive.
- How the organization is governedIndependent directors, real board minutes, audited or reviewed financial statements, and clear conflict-of-interest policies all show an insurer that decisions are made properly, and they improve your terms.
- The limit you chooseOn some policies legal defence costs are paid within your limit, and on others in addition to it, as your declarations page sets out, and defending a director is expensive even when the claim goes nowhere. We size the limit with both the defence and the outcome in mind.
- Claims history and anything already in motionPast claims raise the price, and a lawsuit or investigation you already know about before the policy starts is generally not covered, which is why the application asks.
- What you are about to doRaising capital, buying or selling a business, taking on major debt, or a round of layoffs all raise the chance of a claim, and insurers will price a policy differently if any of them are on the horizon.
Frequently asked questions.
What does directors and officers insurance cover?
It covers claims against your directors and officers personally for decisions they made running the organization: not living up to their duties, mismanagement, misleading statements, breaking a regulation, or employment-related wrongs. It pays legal defence, settlements, and court awards, protecting their personal money and paying the organization back when it covers those costs on their behalf.
We are a private company or non-profit. Do we still need it?
Yes. This is not just for public companies. Private businesses and non-profits face claims from employees, competitors, creditors, regulators, and donors. Non-profit directors are often volunteers whose personal money is exposed, and many capable people will not join a board without this coverage in place. The risk is broader than most owners expect.
Who can bring a claim against directors and officers?
A wide range of people: shareholders or members, employees (wrongful dismissal, discrimination, harassment), competitors, creditors, customers, and government regulators. Because claims can come from so many directions, this is one of the harder risks to see coming, which is exactly why the coverage is valuable.
How is it different from general liability?
General liability covers physical harm: injuries and property damage. This coverage is about decisions, disclosures, and duties that hurt someone's interests, with no physical injury involved. The two protect against completely different claims, so one does not replace the other.
Does it cover employee claims like wrongful dismissal?
It can. Many policies include, or let you add, coverage for employee claims like wrongful dismissal, discrimination, and harassment, which are often the most common claims smaller organizations actually face. We will confirm whether that is built into your policy or better handled as its own coverage.
Are there claims it does not cover?
Yes. It generally leaves out deliberate fraud, dishonesty, and cases where someone illegally profited (though your defence is often paid until that is proven), physical injury and property damage, and claims you already knew about before the policy started. This coverage also only responds while the policy is active, and how legal defence costs are treated varies by policy: on some they are paid within your limit, and on others in addition to it, as set out on your declarations page. Keeping coverage continuous and choosing a limit sized to how yours is written both matter.
Protect Your Leadership Team
Our team is ready to find the right coverage at the right price. Get a tailored quote today.