Personal Directorship Liability

Protecting the Independent Director

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Personal Directorship Liability (PDL) is a liability policy for independent directors that responds when certain losses are not indemnified by their companies, or not paid by other Directors & Officers Liability insurance.

The policy is designed to meet a variety of needs for an independent director and can be customized to cover any combination of boards that a director serves on. PDL can be the last line of defense for independent directors before they need to tap their personal assets to respond to a claim.

Coverage Highlights

Comprehensive Independent Directorship Coverage
A PDL that protects a director’s personal assets against each individual position that he or she chooses to designate for coverage, whether for a publicly traded, privately owned, or not-for-profit company.

Individual Protection
PDL protection providing a dedicated limit for a sole insured person, to help protect their individual assets

Last Line of Defense, with No Retention
This coverage applies for loss in excess of any other insurance, and is indemnification from any source; it takes effect prior to the insured tapping into his or her own assets. This can occur when the underlying insurance:

  • Is financially unable to pay
  • Has been rescinded
  • Is precluded by breach of a non-severable warranty
  • Is deemed part of a corporation’s bankruptcy estate, rendering the corporation unable to indemnify

Drop-down Coverage
In this case, the PDL covers damages in excess of those that are covered by a corporation’s existing D&O Liability policy. In addition, in the event that the indemnification under the existing D&O Liability policy is rendered uncollectible, the Personal Director’s policy extends to apply.

Freedom to choose defense counsel
PDL most often facilitates the freedom of the insured to choose their defense council.

Spousal Coverage
PDL allows a spouse or domestic partner to be named as co-defendant, and to be covered in addition to the Director as an extension of the policy.

Policy limits of up to $10 million are available.