Property Business Interruption FAQs

The threat of coronavirus is affecting all of us, and you will no doubt have questions related to your insurance cover with Hiscox. In light of this, we have prepared a series of answers to some of the frequently asked questions we are receiving.

What is directors’ and officers’ insurance?

Directors’ and officers’ insurance is a type of management liability cover. It’s designed to protect the leading figures in a private firm, for example, directors, officers and LLP partners, when claims are made against them personally. It can help defend allegations such as breach of duty of care or defamation, for example.

A business generally takes out this insurance on behalf of its leadership team as part of its risk-management strategy. It’s for limited companies, not charities or non-profit organisations.  

D&O insurance recognises the powers and high-level responsibilities held by leading figures in a business. It acknowledges that these duties bring additional risks, such as regulatory action, civil claims or even criminal proceedings .

This insurance is ultimately designed to limit personal losses for individual directors, helping them to address potential disqualification, awards for damages and fines.
 

What does D&O insurance cover?

D&O insurance helps to cover  senior leaders against claims of wrongful acts. For example, it may address risks such as:


  • Breach of duty of care
    Breach of trust
    Negligent errors
    Defamation
    Health and safety failure
    Breach of company rules and regulations. 


In such cases it can help with the cost of defending company leaders from such allegations and the cost of legal representation. You can also be reimbursed for losses felt as a result of the claim. 
Depending on the policy, D&O insurance can cover existing directors and officers within your business, and potentially past and future ones. Non-executive directors can also be   covered. D&O cover can apply to a variety of senior managers. For example, your chief executive, chief operating officer and partners.