Navigators Pro, a division of Navigators Management Company, a subsidiary of The Navigators Group, Inc. (www.navg.com), has introduced the IDL InNAVation(SM) coverage endorsement to its traditional primary directors and officers (D&O) liability policy.
IDL InNAVation(SM) increases security and certainty to independent directors (including audit committee members) under their D&O coverage by providing enhanced protection from a policy rescission.
In a litigation environment experiencing more frequent and severe securities class action lawsuits, independent directors can potentially be exposed to significant personal liability if the insurer rescinds their D&O coverage. IDL InNAVation(SM) is designed to respond to this exposure.
The IDL InNAVation(SM) endorsement is underwritten by Navigators Insurance Company and NIC Insurance Company, which are both rated “A” (Excellent) by A.M. Best.
Chris Duca, president of Navigators Pro, noted, “Independent directors are gatekeepers of the integrity of a corporation’s financial controls and good corporate governance. Since the passage of the Sarbanes-Oxley Act, independent directors face new exposures and greater regulatory and investor scrutiny.” Duca added, “IDL InNAVation(SM) provides the innocent independent directors with the peace of mind that if they fully execute their duties as an independent director and the corporation fully implements and adopts its corporate governance and regulatory requirements, the wrongful acts of others will not void a covered loss under their D&O policy.”
The IDL InNAVation(SM) endorsement to the primary Navigators Pro D&O policy protects independent directors for covered loss alleging civil violations of the Securities Act of 1933, the Securities Exchange Act of 1934, the Sarbanes-Oxley Act of 2002, including any similar state securities laws, and administrative actions brought by the Securities and Exchange Commission or any similar state regulatory agency.
Coverage is not rescindable or voidable to the independent director provided the independent director fully executes his duties as an independent director and the corporation fully implements and adopts the Sarbanes-Oxley Act of 2002, the SEC regulations, and its respective exchange/self-regulatory organization’s (SRO’s) corporate governance requirements.
Coverage for securities claims is limited to insured persons and provides for a pre-set allocation for covered loss for securities claims made against the corporation and insured persons. The IDL InNAVation(SM) is limited to qualified risks. The endorsement is subject to Navigators Pro’s underwriting evaluation and an additional premium.