Directors and officers of companies in Canada will have broader protection for claims made against their personal assets under a new Directors’ and Officers’ policy introduced by Minn.-based St. Paul Travelers.
A written statement issued by the company said that the Executive Choice(TM) Plus product 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.
In addition, the policy includes a difference in conditions feature which means that the policy is structured to provide broader coverage than the Side A coverage found in most traditional directors and officers policies. The Executive Choice(TM) Plus policy includes 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 policy.
“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,” said Phil Baker, vice president, Financial and Professional Services, Canada. “The Executive Choice(TM) 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 Executive Choice(TM) 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(TM) 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 advantage of the Executive Choice(TM) Plus 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.
The Executive Choice(TM) Plus directors and officers liability policy is currently available from independent brokers located throughout Canada. For more information, visit the St. Paul Travelers Canada Web site at www.stpaulinsurance.ca/ or contact your local D&O underwriter.
St. Paul Travelers is a provider of property and casualty insurance. For more information, visit www.stpaultravelers.com.
SOURCE: St. Paul Travelers
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