Directors & Officers
The primary role of this coverage is to protect the personal assets of Directors & Officers. These individuals can be held personally responsible in the event of allegations of breaches in their duties as Directors and Officers, which are stipulated by the different Canadian business statutes. Such claims can include allegations of errors, misstatement, omissions, neglect or breach in duty in their role as Directors & Officers. Certain events such as a merger, acquisition, initial public offering, can create greater exposure for these individuals. Furthermore, coverage also applies in the event of financial impairment situations, where Directors & Officers are held personally and jointly responsible for any breaches of statutory liabilities. These would include unpaid wages, vacations, bonuses, commissions, sources deductions, and taxes. Litigation against Directors & Officers can be brought by many different sources, including partners, shareholders, employees, government, regulatory bodies, customers, suppliers and competitors.
Directors & Officers Liability Insurance was once purchased exclusively by public companies, while today the coverage is available for both public and private companies of all sizes.