Which insurance is commonly associated with 'claims-made' coverage and governance liability?

Which insurance is commonly associated with 'claims-made' coverage and governance liability?

• A. Commercial general liability insurance.
• B. Property insurance.
• C. Auto liability insurance.
• D. Directors and Officers liability insurance.

Answer: (D)

Directors and Officers liability insurance is designed to protect individuals in governance roles from claims of wrongful acts in their oversight. It is commonly written on a claims-made form, which triggers coverage when a claim is filed during the policy period, rather than when the act occurred. This setup fits governance liability well because claims about decisions or actions by directors and officers can surface long after the act, and tail coverage can be added to protect for prior periods. In contrast, commercial general liability is usually occurrence-based and covers broad business risks, property insurance covers physical property, and auto liability covers vehicle-related risks, none of which focus specifically on governance-related wrongful acts.

Directors and Officers liability insurance is designed to protect individuals in governance roles from claims of wrongful acts in their oversight. It is commonly written on a claims-made form, which triggers coverage when a claim is filed during the policy period, rather than when the act occurred. This setup fits governance liability well because claims about decisions or actions by directors and officers can surface long after the act, and tail coverage can be added to protect for prior periods. In contrast, commercial general liability is usually occurrence-based and covers broad business risks, property insurance covers physical property, and auto liability covers vehicle-related risks, none of which focus specifically on governance-related wrongful acts.