Does D&O Cover Mismanagement?
D&O may cover claims alleging management missteps when they meet the policy’s wrongful-act definition.
General coverage language does not guarantee payment for every operational mistake.
An allegation of poor management can fit a wrongful-act definition, but intentional wrongdoing, personal profit, and known or pending matters may trigger conduct or prior-acts exclusions. Side A and B concern leaders and corporate indemnification; Side C depends on whether the company’s own alleged liability is within its grant. The allegation alone does not establish the final outcome, and conduct exclusions may use a final-adjudication threshold. Check that threshold, severability among insureds, advancement of defense costs, and any recoupment provision. Keep prior notices and renewal applications aligned so a previously reported dispute is not assumed to be new coverage.
