Aon | Financial Services Group
Back to FSG Quick Insights | Subscribe to FSG Quick Insights >>
Directors and officers (D&Os) of public companies and private and nonprofit organizations face significant liability risks. Shareholder derivative actions, insolvency risk, and the regulatory actions underscore the need to implement strong risk management strategies and robust D&O insurance programs.
As fiduciaries required to act in their organizations’ best interests, D&Os can be held liable for misconduct that allegedly harmed the organization. Indemnification of settlements is usually prohibited in shareholder derivative lawsuits, in which plaintiffs sue D&Os on behalf of the organization. An insolvent company is also unable to indemnify its D&Os, and the number of large corporate entities filing for bankruptcy protection so far in 2024 has increased. Both insolvency and shareholder derivative lawsuit risks underscore the importance of dedicated Side A coverage.
Regulatory authorities have also been more active in policing misconduct among public and private firms.
Learn more in this Business Insurance Risk Perspective from Aon.
About Aon
Aon (NYSE: AON) exists to shape decisions for the better — to protect and enrich the lives of people around the world. Through actionable analytic insight, globally integrated Risk Capital and Human Capital expertise, and locally relevant solutions, our colleagues provide clients in over 120 countries with the clarity and confidence to make better risk and people decisions that help protect and grow their businesses.
Follow Aon on LinkedIn, X, Facebook and Instagram. Stay up-to-date by visiting Aon’s newsroom and sign up for news alerts here.
©2024 Aon plc. All rights reserved.
Aon is not a law firm or accounting firm and does not provide legal, financial or tax advice. Any commentary provided is based solely on Aon’s experience as insurance practitioners. We recommend that you consult with your own legal, financial and/or insurance advisors on any commentary provided herein. All descriptions, summaries or highlights of coverage described herein are for general informational purposes only and do not amend, alter or modify the actual terms and conditions of any relevant policy. Coverage is governed only by the terms and conditions of such policy. Insurance coverage in any particular case will depend upon the type of policy in effect, the terms, conditions and exclusions in any such policy, and the facts of each unique situation. No representation is made that any specific insurance coverage would apply in the circumstances outlined herein. Please refer to the individual policy forms for specific coverage details.
The information contained in this document and the statements expressed are of a general nature and are not intended to address the circumstances of any particular individual or entity.
This document is not intended to address any specific situation or to provide legal, regulatory, financial, or other advice. While care has been taken in the production of this document, Aon does not warrant, represent or guarantee the accuracy, adequacy, completeness or fitness for any purpose of the document or any part of it and can accept no liability for any loss incurred in any way by any person who may rely on it. Any recipient shall be responsible for the use to which it puts this document. This document has been compiled using information available to us up to its date of publication and is subject to any qualifications made in the document.
Insurance products and services offered by Aon Risk Insurance Services West, Inc., Aon Risk Services Central, Inc., Aon Risk Services Northeast, Inc., Aon Risk Services Southwest, Inc., and Aon Risk Services, Inc. of Florida and their licensed affiliates.