With the authorities tightening the screws on directors and senior corporate bosses after Láffaire Vijay Mallya and the Panama Papers revelations, there has been a scramble by companies to get large Directors and Officers Liability (D&O) insurance policies.

Corporates are opting for covers as large as Rs 500 crore, says Mahesh Chainani, Senior VP at Howden India Insurance brokers, which specialises in D&O policies.

Premiums in this segment have crashed almost 60 per cent in the last five years due to rising competition among insurers, Chainani adds.

However, a key exclusion in the D&O policy is loss arising from dishonesty, fraudulent conduct and self-admission (of wrongdoing), but the policy will cover all innocent employees, say insurers.

KG Krishnamoorthy Rao, MD & CEO, Future Generali says, “Initially, D&O policies were taken only by listed companies. However, in the last two years, there has been a demand for such policies by non-listed companies such as SMEs and start-ups as well.”

Insurers also say that with increasing litigation and widening corporate exposure, the coverage sought has widened beyond the basic policy.

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