E&O insurance covers the Insureds legal liability to third parties for claims first made against the Insured during the period of insurance, arising out of a negligent act, negligent error or negligent omission on the part of any employee of the Insured, when committed in the ordinary course of the Insureds business. In other words, E&O insurance protects the assets of the assured company against loss arising out of a breach of professional duty committed by any one or more employees. It protects the company; it does not provide protection to individual people.
On the other hand, D&O insurance provides cover under two sections. The cover under each section is the same, which is the protection against an allegation of a wrongful act committed or wrongly attempted by the individuals concerned in their capacity as a Director or Officer.
However, due to certain legal statutes governing the circumstances under which a company may indemnify its Directors, it is necessary for the Directors to insure certain exposures and for the company to insure others.
As part of the experience Lenix REinsurance Intermediaries has in many countries in South America, we are aware of the necessity Directors has of protection for allegations of any wrongful acts which are brought by the Government particularly given the fragile nature of the governments and their willingness to bring allegations of impropriety against Directors of successful companies. In this fact is where Lenix REinsurance Intermediaries is focused to develop these lines of business in addition to our offer of these policies to the companies included in our portfolio with other kind of coverages.