The Commercial Directors and Officers Insurance policy provides coverage for claims brought by third-parties against directors and officers of a company for actual breach of duty, neglect, misstatements, errors or omissions in their capacity as directors and officers. Coverage includes advancement of defense costs granted prior to final disposition of a claim for individuals when the corporation cannot provide such costs. Reimbursement for indemnification of directors and officers for any judgements, settlements and defense costs associated with covered claims when the company has indemnified the insured for loss.

The most relevant claims involve security and employment practice actions. Claims of securities fraud and mismanagement have been made, both in the United States and abroad, in response to little more than press releases announcing declines in earnings, reserves for future events or products that do not perform in the marketplace as anticipated. Drops in stock prices have led to automatic lawsuits with little or no information to support allegations of actual conduct. Claims by employees, as well as other third parties, such as creditors and regulators, are also increasing in today's litigious environment.

Customer Profile

Directors and officers of public and private companies of all sizes engaged in various business areas, including Manufacturing, Utilities, Services, Retail, Wholesale, Chemicals, Agriculture, Pharmaceuticals, Engineering, Real Estate, and Transportation. AIU is considered the most innovative D&O market and will consider unique risks for coverage.

Value Added / AIU Advantage

AIU can provide U.S. $25 million in capacity. In the United States, an AIG Group company, National Union Fire Insurance Company, is the nation's leading provider of this type of coverage. AIG's international companies all have access to National Union's underwriting, claims and defense experience which are utilized to custom make coverage designed to provide the highest level of protection to ADR issuers. As part of this coverage there is increased access to a panel of U.S. lawyers to provide a specialized defense to litigation brought against ADR issuers directors and officers. Global companies can extend their coverage to their overseas subsidiaries. No deductibles are required for directors and officers when indemnification by the corporation is not permitted. Defense costs will be advanced to individual directors and officers for non-indemnifiable claims. Enhancement features and specialized products are available, including Entity Coverage for Open Market Securities Claims, Securities Offering Entity Coverage, Employment Practices Liability Insurance and Pollution Insurance.