Canadian Underwriter
News

New D&O policy covers non-indemnifiable claims


April 20, 2006   by Canadian Underwriter


Print this page Share

St. Paul Travelers (NYSE:STA) is offering a new policy designed to give directors and officers of Canadian companies broader protection for claims made against their personal assets.
St. Paul’s new Executive Choice Plus package provides coverage for “Side A” non-indemnifiable claims or claims that can’t be reimbursed by a company, such as derivative lawsuits or those that result from corporate insolvency.
“The recent high-profile corporate scandals in the U.S. and Canada involving directors and officers has caused many serving on boards to become concerned about whether they have appropriate insurance coverage in place,” Phil Baker, vice president of St. Paul’s financial and professional services in Canada, said. “The Executive Choice Plus policy will give companies an opportunity to access a much-needed level of protection for directors and officers that wasn’t previously available in the Canadian marketplace.”
The policy is structured to provide broader coverage than the Side A coverage found in most traditional directors and officers policies by including fewer exclusions. For example, claims resulting from a violation of the responsibilities, obligations or duties imposed by Canada’s Pension Benefits Standards Act or under ERISA are not excluded under the policy. In addition, there is no pollution exclusion contained in the new policy.
The Executive Choice Plus policy will provide protection when the primary insurance company wrongfully refuses to cover a loss, rescinds the primary policy or is financially unable to pay a loss. In addition, one feature of the Executive Choice Plus policy allows it to become the primary insurance coverage for some claims that are excluded under a traditional Side A directors and officers policy.
Another feature of the policy is that it provides an additional source of excess coverage for directors and officers in situations where the corporation cannot or will not indemnify.


Print this page Share

Have your say:

Your email address will not be published. Required fields are marked *

*