Explain whether the following situations are covered under a directors and officers (D&O) policy. Treat each situation separately.

a. A marine and transport consultancy contracted to provide services to an oil major. It was later alleged that a director of the consultancy had breached the confidentiality provisions of the contract by passing over sensitive commercial information to a competitor The responsible director of the consultancy was sued for wrongful act, thereby resulting in financial loss for the oil major. The individual director denied that he had done anything wrong and asked his employer to indemnify him. The cost of defense was around $500,000.

b. A manufacturing company has been sued by the Health and Safety Enforcement following their refusal to respond to a notice to control dust emissions. Directors responsible have failed to adhere to deadlines and, consequently, actions have been taken against both the company and the directors responsible.

c. A former director of a company sued the current directors alleging that they had conspired to deny him his correct pension benefits. The directors personally incurred costs of $36,000 defending the claim.