Financial lines specialty MGA wrap aims to fill D&O gap

Specialist financial lines MGA Kayzen Specialty has launched a new excess layer directors and officers’ (D&O) liability policy as its chief executive said there was a ”real need” to enhance client outcomes.

The policy has been designed to protect individual executives from unexpected gaps in coverage and is sold as an addition to the standard D&O cover.

Kayzen described it as “additional defensive safety net,” protecting company management from vulnerabilities in the underlying primary policy.

It added: “This ‘wrap’, which forms part of the excess layer on a traditional D&O tower, will drop down into the primary layer and offer cover where the primary cover is refusing to pay either due to an exclusion or because of a limitation elsewhere in the policy.”

Kayzen added that the wrap will also protect the individuals where an underlying insurer has become insolvent, or when an insurer’s D&O business has gone into run-off, which can lead to a more restrictive interpretation of policy terms.

Need for innovation

Chief executive Charles Boorman said the new wrap was indicative of the need for innovation.

He explained: “Kayzen Specialty is demonstrating yet again our commitment to enhancing client outcomes.

“Our new Side A Wrap (Saw) product provides broader personal asset protection whilst enhancing brokers’ ability to retain or win business with a product that is a unique differentiator in the D&O market.

”We are delighted with the initial response from our brokers to a truly innovative broadening of ground up coverage that maintains the integrity of a traditional D&O tower.”

Kayzen added that the policy would also protect individual directors and officers from company indemnification issues, such as when a company becomes insolvent and cannot indemnify, gaps around derivative actions or where the company chooses not to indemnify.