Directors and Officers Coverage

CURIE's Directors and Officers Coverage 

CURIE does not issue a stand-alone D&O policy. The coverage is provided as part of the Education Errors and Omissions Liability Policy. 

Insureds 

The CURIE policy definition of Insured persons is very broad-covering any past or present officer, director, volunteer or member of the directing or governing body while acting on behalf of the Named or Additional Insureds. 

Outside Directorships 

Coverage also applies to Directors and Officers of outside entities if acting as such at the direction of their institution. 

Wrongful Acts Coverage 

Coverage applies to damages claimed as a result of a Wrongful act.

  • Wrongful Act is broadly defined as "any actual or alleged error, misstatement or misleading statement, or act or omission or neglect or breach of duty or any matter claimed against them solely be reason of their being or having been an Insured.

This is broader than the term "negligence" that is generally defined as the failure to use that degree of care that is considered to be reasonable under the given circumstances. Black's Law Dictionary equates errors and omissions with "mistakes". 

Pay On Behalf of Coverage 

This provides payments for the ongoing defense of an action or claim, making it preferable to some policies that "indemnify" or reimburse insureds for their incurred expenses (sometimes not until the action is concluded). 

Deductibles 

The majority of D&O policies have a corporate deductible and an individual director deductible and aggregate all directors deductible. 

CURIE's policy provides for first dollar cover (nil deductible).

Coverage Limits 

CURIE provides a $50 Million limit per claim except for 6 coverage extensions with sub limits. These extensions are typical not covered by commercial D&O policies:

  • Terrorism $3 million
  • Cyber $3 million
  • Asbestos $3 million
  • Fungi & Derivatives $5 million
  • Molestation $5 million
  • Data (corruption misappropriation, altering, deleting, using etc.) $5 million
  • Communicable Disease Liability - $1 million (shared)

Coverage also includes $50 million for Fiduciary Liability (Pension & Benefit Trust Liability). 

Includes coverage against wrongful acts and any alleged or actual errors, omissions, or negligence on the part of the insured in the administration of the plan, even if the claimant does not also allege a breach of fiduciary duty (a wrongful act). Coverage extends to claims alleging errors omissions, or negligence related to day to day operations of the plan, record keeping investment decisions, providing information to participants, etc. 

Damages 

The CURIE policy covers actions claiming some type of monetary settlement, that, if paid by the plan would reduce plan assets. 

The following are not considered damages:

  1. Benefit claims: Disputes over eligibility, benefit amounts, types of benefits payable, interpretation of plan provisions are not covered. Such claims do not usually include damage claims, if the claimant is successful; the plan is paying what it was legally obligated to pay in the first place.
  2. Non-pecuniary claims (claims for other than money): This would include actions taken to enforce or clarify a participant's rights or to obtain equitable relief from an alleged violation such acts may include a request for an injunction, a change to the pension plan trustee, on action to give employees more involvement in administration of the plan or other court order not involving damages.

Exclusions

The exclusions contained in this policy can be divided into 4 categories:

1.    Coverage provided in the CURIE General Liability policy

  • Pollution broad-sudden and accidental pollution cover provided
  • Bodily Injury /Property Damage
  • Nuclear
  • Personal Injury-libel, slander, defamation, etc.

2.    Coverage proved by other classes of Insurance:

  • Dishonesty of a D&O - Crime Insurance
  • Gradual Pollution-Environmental Liability Insurance
  • Intellectual Property

3.    Public Policy Exclusions

  • Gaining of illegal profit
  • Securities Acts violations

4.    D&O Coverage Exclusions not listed above

  • Fines or penalties
  • Willful violation of statute
  • Breach of Contract ( coverage provided for education malpractice claims if brought as a breach of contraction claim)
  • Outside Entity Boards - Communicable Disease Exclusion. Removes coverage for claims related to communicable disease suits unless the outside entity has an underlying D&O policy in force that includes communicable disease coverage. In this case, CURIE will provide excess coverage only.

Please contact bryan.mcgann@queensu.ca if you have any questions concerning this coverage.