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Directors and officers insurance

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How much does directors and officers insurance cost?

The cost of directors and officers insurance in New Zealand typically averages between $50 – $100 per month. Costs in New Zealand can vary widely, with factors such as the nature of the business, business structure, and the risk profile of the industry playing a key role in determining premiums.

What is the average cost of directors and officers insurance? 

Businesses in New Zealand typically pay between $50 – $100 or around $1,000 annually for their directors and officers insurance

It is important to note that directors and officers insurance is often included in a business management liability insurance package which can make the cover more affordable for small businesses. 

Understanding D&O insurance cost factors

Three major factors that influence the cost of directors and officers insurance are:

Size and Complexity of the Business

Larger organizations with a vast operational footprint tend to have higher premiums. This is because the more complex a business, the higher the risk and potential liability. More employees, higher revenues, and a larger customer base can all increase the likelihood of a claim, thus raising insurance costs.


The industry in which a business operates plays a significant role in determining D&O insurance cost. Industries with higher risks, such as technology or finance, often see higher insurance premiums. This is due to the increased potential for litigation in these sectors

Claims History

A business’s past claims history can also impact insurance premiums. If a business has a history of many claims, insurers may view the business as high risk. This can lead to higher premiums. Conversely, a clean claims history can potentially lower the cost.

Directors and Officers Provides Cost-Effective Protection for Your Business

D&O insurance offers crucial protection for businesses in New Zealand. Here are three ways it helps:

Protects Personal Assets

D&O insurance can shield the personal assets of directors and officers. Without it, these individuals could be personally liable for claims made against them, potentially risking their homes, savings, and other personal assets.

Covers Legal Expenses

D&O insurance covers legal costs, which can quickly accumulate in the event of a claim. These costs include attorney fees, court costs, and any settlements or judgments.

Supports Business Continuity

By covering potential legal costs and financial damages, D&O insurance can help ensure the continuity of your business. It can provide financial stability and peace of mind, allowing directors and officers to focus on running the business instead of worrying about potential claims.

It’s crucial to have directors and officers insurance if:

  • Your business operates in a high-risk industry
  • You have a large-scale operation
  • There’s significant potential for legal disputes
  • Your business has a complex organizational structure

How Can You Save on Directors and Officers Insurance?

There are several strategies that could help you reduce the cost of D&O insurance:

Risk management strategy

By implementing a robust risk management strategy, you demonstrate to insurers that you’re proactive about reducing potential risks. This can include regular training for directors and officers, establishing clear company policies, and having a system to address potential issues promptly.

Bundling as part of a management liability package

Many insurers offer the option to bundle D&O insurance with other types of coverage under a management liability package. These packages often include employment practices liability, fiduciary liability, and crime insurance. By bundling these coverages together, you could save money compared to purchasing each policy separately. It’s like buying in bulk – the more you get at once, the less each unit costs. Plus, it has the added advantage of ensuring that there are no coverage gaps between policies.

Engage our directors and officers insurance brokers at Gerrards

Here at Gerrards, we know the ins and outs of directors and officers insurance. Our team of insurance brokers is equipped to guide you through the process of selecting the most suitable and affordable insurance policy. We have an extensive network of insurance providers, and our job is to negotiate on your behalf, compare offers, and secure the best rates for you.

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