Insurance Coverage under D&O and Professional Liability Policies: Watch Your Insurance Company's Fuzzy Math


PUBLISHED ON: June 20, 2007

Trouble hits. Ten actions by 10 claimants separately allege that a director or senior executive at your company caused each claimant a loss of $1 million. Despite the separate claims, it appears that the allegations all arise from a single act, or perhaps related acts, of alleged malfeasance. The actions name the executive as well as your corporation as defendants. The policy provides for a $1 million retention or deductible-the amount of money your corporation pays per loss before the insurance company begins to cover your claim.