Sitting on a board comes with more personal exposure than most people realize until something goes wrong. A director or officer can be held personally liable for decisions made on behalf of an organization, whether that’s a private company, a nonprofit, or a condo board, and personal assets like a home or retirement savings can be at risk if a lawsuit succeeds.
D&O policies are generally structured around three types of protection, often referred to as Side A, B, and C coverage:
Protects directors and officers personally when the organization is unable to indemnify them, such as during bankruptcy or when indemnification is legally restricted.
Reimburses the organization when it covers the legal fees, defence costs, or settlements incurred by its directors and officers.
Protects the organization itself when it's named in a lawsuit alongside its directors and officers, often the broadest form of coverage for private companies.
Directors and officers insurance (D&O) protects the individuals who make decisions on behalf of an organization, along with the organization itself when it’s named alongside them. In Alberta, where boards span everything from small nonprofits to energy and resource-sector companies, this coverage matters across a much wider range of organizations than people assume.
A few things generally fall outside a standard D&O policy:
Coverage doesn't extend to deliberate criminal conduct by a director or officer.
Intentional fraudulent acts are typically excluded from coverage.
These fall under general liability coverage, not D&O.
Even well-run organizations face this exposure. A few recurring scenarios illustrate why:
Allegations of wrongful termination, discrimination, or harassment can lead directors and officers to be named personally in a lawsuit.
Claims can arise from decisions around promotions, demotions, or disciplinary actions perceived as unfair.
In Alberta specifically, boards tied to energy, infrastructure, and resource-based industries face added exposure from commodity price volatility, regulatory oversight, and environmental obligations.
Costs vary significantly based on the type and size of organization:
Typically the most affordable tier, generally ranging from $600 to $1,700 a year.
Often around $1,650 a year on average, though this varies with revenue and industry.
Commonly $5,000 to $10,000 per $1 million of coverage, depending on risk profile.
The highest tier, often priced between 0.25 percent and 5 percent of the coverage limit purchased.
Several factors shape what an organization pays for this coverage:
Nonprofits generally pay less than private companies, which pay less than publicly traded corporations.
Organizations in higher-risk sectors, such as energy or resource development, typically face higher premiums given regulatory and market exposure.
Higher coverage limits increase the premium, particularly for private and public companies.
Larger boards with more directors and officers can increase the organization's overall exposure.
Past claims against the organization or its leadership can raise future premiums.
Here’s what sets an InsureMy policy apart for Alberta boards and organizations:
Whether it's a nonprofit, a private company, or a condo corporation, our advisors build coverage around your organization's specific structure and risk.
We understand how Alberta's energy, resource, and infrastructure sectors shape governance risk for boards across the province.
Our trademarked approach looks at how your D&O coverage fits alongside your other organizational policies, not just in isolation.
You'll talk through your organization's actual structure and risk with a real advisor, not a generic quote form.
Insurance
Directors and officers insurance connect with Commercial General Liability and Professional Liability Insurance, particularly for organizations facing both governance-related and operational exposure.
Any organization with a board, including private companies, nonprofits, and condo corporations, can benefit, since directors and officers can be held personally liable for decisions made on the organization’s behalf.
No. Standard D&O policies exclude deliberate criminal conduct and fraud, focusing instead on claims related to governance decisions and alleged wrongful acts.
Side A protects individuals directly, Side B reimburses the organization for indemnifying its directors and officers, and Side C protects the organization itself when named in a claim.
Yes. Nonprofits can face claims related to employment decisions, governance disputes, or fiduciary responsibilities, and rates for nonprofits are typically the most affordable tier available.
It can. Claims involving wrongful termination, discrimination, or harassment allegations against directors or officers are common triggers for a D&O claim.
For your organization’s D&O coverage, and talk to an InsureMy advisor about protecting your board the right way.
