What is Directors and Officers (D&O) Insurance?

Directors and Officers (D&O) insurance protects individual directors and senior officers against personal liability claims arising from management decisions and actions taken in their capacity as a director. It covers legal defence costs and any damages awarded in claims alleging wrongful acts, mismanagement, breach of fiduciary duty, errors in financial reporting, employment disputes and regulatory investigations. It is particularly important for companies seeking investment, as investors often require D&O cover as a condition of funding. Unlike public liability or professional indemnity, D&O insurance is designed specifically to protect individuals rather than the company.