Understanding D&O Exposures

Course Details

This course is not subject to discount pricing.

Additional Credit Available:

Add Insurance CE

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Field of Study: 

Management Services

Last Reviewed: 

May 2017

Exam Requirements

Proctor Required: 


Passing Grade: 




Please note: Adding Additional Credit may change exam requirements.

Course Description
Directors and officers of for-profit, publicly-held corporations and not-for-profit corporations face a number of legal liability exposures. This course is designed to give a moderately experienced person in insurance a detailed look at these exposures. The major areas this course addresses include (1) the common law and statutory legal liability exposures to which the directors and officers of publicly held corporations are subject, (2) legal defenses available to directors and officers when a claim is made against them, (3) the types of situations that give rise to these claims, (4) the factors that insurers consider when underwriting directors and officers (D&O) policies for publicly held and privately held companies, and (5) the most effective methods of preventing and controlling claims against corporate directors and officers.

Learning Objectives
This is an intermediate level study course.  Students who successfully complete this course will be able to:

  • identify the general nature and purpose of corporations, and identify the functions served by directors and officers within corporations
  • differentiate between the three key common law duties that directors and officers owe to corporations
  • identify the major federal securities laws that can give rise to D&O liability
  • identify the most important statutes (other than those pertaining to securities liability) that can subject directors and officers to claims
  • recognize the most important legal defenses that directors and officers have available to them when claims are asserted against them
  • recognize the essential nature of securities class action claims
  • recognize the major sources of securities class action claims against directors and officers, including claims from financial restatements, IPOs, change-of-control situations, stock option backdating, and private equity operations
  • recognize the various types of parallel proceedings, including derivative, op-out, ERISA stock-drop claims, and regulatory/criminal proceedings
  • identify reasons behind the four major underwriting factors considered by insurers in underwriting and pricing D&O coverage
  • identify the so-called general methods of preventing D&O claims
  • identify appropriate methods of controlling D&O losses that pertain to corporate governance, given relevant information
  • recognize the distinctive features of private companies and the types of claims commonly made against these companies
  • identify the distinctive features of nonprofit organizations, and recognize the types of claims these organizations typically face


A basic understanding of commercial insurance and management liabilities.

CPE Field of Study
Management Services

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