Directors & Officers Liability
Protecting Your Leadership Team
In today’s complex business environment, company leaders—whether directors, officers, or senior managers—are increasingly exposed to personal legal risks arising from their decisions and actions. Directors & Officers (D&O) Liability Insurance provides essential personal liability protection for key individuals within your organization. It covers claims that may result from alleged wrongful acts performed in their managerial capacity.
Why Your Business Needs D&O Insurance
Company executives can face legal action from shareholders, regulators, employees, or third parties if their decisions result in financial loss or breach of duty. Even if unintentional, such claims can lead to expensive litigation. D&O insurance covers legal defense costs and any compensation awarded if the defense is unsuccessful—ensuring personal assets of your leadership team remain protected. This type of insurance helps your key decision-makers operate with confidence, knowing they’re covered against potential legal fallout.
How to Choose the Right D&O Coverage
D&O Insurance is usually taken as a standalone policy, complementing your existing business insurance. The coverage can be customized based on your company’s size, industry, and specific risk profile. Whether you’re a startup or an established enterprise, CoverBee works with you to create a policy that fits your operational needs and protects your leadership from legal exposure.
Directors & Officers Liability FAQs
Directors & Officers Liability Insurance protects the personal assets of a company’s directors and officers if they are sued for wrongful acts while managing the company. It covers legal costs, settlements, and judgments.
D&O Insurance is essential for:
● Public and private companies
● Non-profit organizations
● Startups and large corporations
It protects directors, board members, key executives, and sometimes employees involved in key decisions.
It covers:
● Breach of duty, neglect, or errors in decision-making
● Mismanagement of company affairs
● Misrepresentation or misinformation
● Employment-related claims (e.g., wrongful termination, harassment)
● Regulatory or legal actions
Typically excluded:
● Fraud or intentional illegal acts
● Bodily injury or property damage (covered under other policies)
● Prior claims or known issues before policy inception
● Fines and penalties (in some cases)
D&O lawsuits can be brought by:
● Shareholders
● Employees
● Regulators
● Creditors or competitors
D&O Insurance ensures that legal defense and settlement costs do not come out of personal pockets of the leadership team.
Yes, many D&O policies offer "run-off" coverage or retroactive cover for actions taken while they were in office, even if they are no longer serving.
Premium depends on:
● Company size and revenue
● Industry risk profile
● Number of directors/officers
● Claims history
● Corporate governance practices
No, it’s not legally mandatory in India, but it’s strongly recommended especially for companies with external investors, listed firms, or those under regulatory scrutiny.
Yes! In fact, many investors insist startups have D&O coverage to protect leadership from potential claims and safeguard investment value.