Directors and Officers Liability – Extended Reporting Period / Run-Off

Protection that continues when leadership changes.

Directors and Officers Liability – Extended Reporting Period (Run-Off) provides ongoing protection for former directors, and officers after significant changes such as mergers, acquisitions, or the winding up of a business. It covers claims made for wrongful acts that occurred before the transaction or closure.

Essentially, Run-Off acts a “safety net” for past management decisions, ensuring that previous directors and officers remain protected once they’ve stepped away from the company.

Run-Off typically mirrors the D&O policy structure:

• Side A – Protects individual directors and officers where they have not been indemnified by the company.
• Side B – Reimburses the company when it indemnifies its directors and officers for covered claims.
• Side C – Covers the company itself for claims brought against it, but only in respect of securities claims.

Run-Off is generally provided for a three-to-six-year period effective in line with the change in control, and finalised to mirror the statute-of-limitation period.

Whether following a sale, merger, or closure, D&O Run-Off ensures peace of mind for those who’ve served in leadership – safeguarding against future claims tied to past management decisions.