Regulatory and criminal investigations and prosecutions under
D&O policies raise important issues.
Policy triggers for regulatory and criminal investigations can
be a grey area. Considerable latitude exists between routine
enquires by regulators that are part of business operations (for
example a routine request for information by the FSA) and a crisis
event that triggers internal and external investigations and
dealings with the authorities for dishonesty or fraud. There may be
agreement that the first is not an insured risk and the latter
probably is, but what about the permutations in between?
Uncertainty is confounded by the absence of a standard D&O
wording. Policies may contain separate "investigation"
cover. In addition, investigations may also be "claims"
under the policy's Side A or Side B cover.
