As the end of the year 2007 approaches, many individuals and businesses are working through their insurance renewals. I've come to learn that substantially more policies carry a January 1 renewal date than any other date.
So, I'll attempt over the next month to relay some valuable checklists that can be used during the renewal process.
The first will be for those corporate directors and officers and their D&O Insurance Policy Renewal. Customarily, I walk through each item with my clients and get them ready for (or attend with them) the meeting with their broker. Some of the pieces and parts of D&O policies can be fairly technical.
CHECKLIST FOR D&O
1. Review coverage limits and other liability extensions such as EPLI
2. Review all exclusionary language
3. Ensure that defense provision includes frivolous claims (private/not-for-profit)
4. Determine if subsidiaries and past subsidiaries are covered and what
constitutes a subsidiary
5. Determine if coverage includes joint ventures and general/limited partnerships
6. Determine if policy includes spousal (or “domestic partner”) liability coverage
7. Determine if policy contains a severability/imputation clause (for Exclusions and/or Application)
8. Determine if policy covers criminal, administrative, investigatory or regulatory proceedings
9. Review for any exclusion for bodily injury and property damage
10. Are EEOC charges or complaints, written demands, and verbal or written accusations of wrongdoing covered
11. Are ERISA and plan management excluded
12. Is there an insured v. insured exclusion
13. Determine if the policy excludes allegations of dishonesty or criminal acts or is “adjudication” or written admission required to deny coverage
14. Determine if the coverage applies to the audit committee
15. How are the limits of coverage applied in the event of rescission due to wrongful acts of certain directors and officers
16. How will the policy protect the director and officers individually in the event of bankruptcy
