D&O Insurance — Are You Getting the Coverage You Thought You Bought?

The John Liner Review

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PUBLISHED ON: December 3, 2008

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Companies want to protect their directors and officers (executives) from the costs of defending claims and from having to pay any judgment entered against them arising out of their corporate positions. For individual directors and officers accused of wrongdoing, however, collection on directors and officers (D&O) insurance claims is highly problematic; the beleaguered executive often must run a gauntlet of rescission attempts, interlocutory appeals, and arbitration proceedings stacked against the policyholder. This article examines the pitfalls of insurance recovery on Side A coverage, which protects individual directors and officers, and on difference in condition (DIC) policies, which purport to protect directors and officers when Side A and Side B coverage of a traditional D&O policy fails.