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Has Your Corporation Unwittingly Agreed to Indemnify its "Executives"?
Wednesday, September 4, 2024

The "usual suspects" when looking for director and officer indemnification requirements are:

  • Applicable law;
  • Articles of Incorporation;
  • Bylaws; and
  • Stand-alone indemnity agreements.

One place that I had not previously thought to look is the company's directors and officers liability insurance policy. Recently, however, I came across the following provision in one such policy:

[T]he Organization shall be deemed to provide indemnification to the Executives to the fullest extent permitted or required by law, and hereby agrees to indemnify the Executives to the fullest extent permitted or required by law . . .".

I do not know know how common this type of agreement may be in directors and officer liability policies. However, it seems that the company's D&O policy might be one more place to look.

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