Business Insurance
Directors & Officers Insurance
Leadership carries personal liability. Directors and officers insurance protects the individuals who run your organisation against claims arising from decisions made in the course of their duties — so they can lead with confidence.
Overview
What is D&O insurance?
Directors and officers (D&O) insurance is a form of management liability cover that protects the personal assets of company directors, officers, trustees, and senior managers when they are held personally liable for decisions or actions taken in the course of managing an organisation.
Unlike employer's liability or public liability, D&O insurance is specifically designed to respond to claims made against individuals rather than the company as a whole. This is a critical distinction: without adequate cover, a director's personal assets — including their home and savings — can be at risk in the event of a claim.
D&O cover is typically structured across three coverage layers — Side A (direct cover for individuals when the company cannot indemnify), Side B (reimbursement to the company when it does indemnify individuals), and Side C (entity cover for securities claims) — and can be tailored to the governance structure and risk profile of your organisation.
Coverage
What does it cover?
Wrongful Acts
Covers claims alleging a wrongful act by a director or officer in the performance of their duties, including actual or alleged errors, misstatements, misleading statements, and breaches of duty.
Employment Disputes
Provides cover for employment-related claims brought against individual directors or officers, including allegations of unfair dismissal, discrimination, or harassment in a managerial capacity.
Regulatory Investigations
Responds to costs arising from formal investigations by regulatory authorities — including the FCA, CMA, HMRC, or the Insolvency Service — into the conduct of a director or officer.
Shareholder Actions
Covers claims brought by shareholders alleging that directors or officers acted in a manner that was not in the best interests of the company, including derivative actions and class actions.
Suitability
Who needs it?
Company directors and officers of any UK limited company — whether private, public, or listed — carry statutory duties under the Companies Act 2006 and can face personal liability if those duties are breached. D&O insurance is the primary mechanism for protecting individuals against that exposure.
Trustees of charities, pension funds, and other bodies corporate have comparable duties under their respective legislation. Trustee liability insurance — a variant of D&O cover — is appropriate for those serving in such capacities.
Senior managers who exercise significant influence or control over an organisation — even where they do not hold a formal directorship — may also benefit from D&O cover. The regulatory concept of a Senior Manager (under the Senior Managers and Certification Regime for regulated firms) broadens the scope of individual accountability considerably.
Speak to a Prime Key Financial adviser about structuring a management liability programme that covers the full range of exposures facing your leadership team.
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