D&O insurance for GmbH managing directors

It covers claims for pure financial loss that arise from a breach of duty by the managing director, typically a claim by the company or its insolvency administrator, and claims by third parties. The insurer examines whether the claim is justified, defends against unjustified claims and pays justified ones, up to the sum insured. In the non-binding model wording of the German insurance association (GDV), this applies to current and former managers and to claims under statutory liability provisions. Which claims a policy names, and which it leaves silent or excludes, depends on its wording.

No. German law requires no D&O policy for a GmbH. A stock corporation does not need a D&O policy either, but if it buys one, section 93(2) of the Stock Corporation Act requires a deductible for its management board; that rule does not apply to a GmbH. A policy can still be required in practice, because an investor, a bank, a parent company or a managing director's contract may ask for it.

General liability insurance protects the company against claims for injury and property damage caused by its business. D&O insurance protects the people who manage the company against claims for pure financial loss caused by their management decisions. The two do not replace each other. The GDV model D&O wording excludes damage caused by products or services that the company placed on the market (A-7.3), which is for the company's own liability policies.

Yes. Under section 43 of the Act on Limited Liability Companies (GmbHG), a managing director who breaches the duty of care is liable to the company for the damage, and the shareholders decide by resolution whether the company pursues the claim (section 46 no. 8 GmbHG). In an insolvency the administrator pursues it. Such claims become time-barred after five years. Whether your policy insures them, and with which deduction, is the first question to ask.

That depends on the wording. The GDV model wording leaves out the part of a claim by the company that matches the share held by the managing director who caused the loss and by relatives, with no minimum threshold. A managing director who holds all the shares therefore receives no damages payment for a claim by the company itself; the clause does not mention defence costs, so ask your insurer how they are treated. Other claimants, such as the tax authority or a buyer of the company, are not affected by that deduction. Ask your insurer whether the deduction applies and how it treats an administrator's claim.

Under section 43 GmbHG, responsible managing directors are liable jointly and severally, so the company can claim the full loss from any one of them. In the GDV model wording, all insured persons share one sum insured for each insured event and each policy period, and defence costs count against it (A-6.4). Conduct is judged separately for each insured person when the exclusion for knowing breaches is applied (A-7.1). Ask how the limit is shared and whether each director has a separate deductible.

What counts is when a claim is first made against the insured person, not when the decision was taken. The policy must be in force, or the reporting period must be running, when the claim is made (GDV model wording, A-2). A claim made after the policy and the reporting period have ended is not covered, even if the decision was taken while you were insured, unless you gave a notice of circumstances in time (A-5.4).

It depends on the wording. In the GDV model wording, cover after an insolvency application is limited to breaches up to the date of the application (A-5.5), and an extra reporting period can no longer be bought if the contract then ends (A-5.3). Some older wordings ended the contract automatically at the end of the insurance period in which an application was filed. The Federal Court of Justice (BGH) held such a clause invalid on 18 December 2024 (IV ZR 151/23), but the decision concerns the wording before the court, so read your own.

That depends on the wording. The GDV model wording neither names nor excludes them. In 2020 the BGH held that a claim under the former section 64 GmbHG fell under the damages clause of the wording before it. In 2025 it held that the exclusion for knowing breaches needs positive knowledge of the specific breach, and that late filing alone does not show a knowing breach of the payment ban. Both decisions concern the former provision and the wording before the court, and we know of no BGH decision on section 15b itself, so ask your insurer in writing.

Not automatically. A managing director can be personally liable for company taxes (section 69 of the Fiscal Code) and can face criminal proceedings for withheld social-security contributions (section 266a of the Criminal Code). The GDV model wording neither lists nor excludes taxes and social-security contributions, so each policy has to say. Ask in writing whether such claims are insured, whether the defence in a criminal proceeding is paid from the start of an investigation, and at which fees (A-6.1).

The German rules for NIS2 require the management of particularly important and important entities to implement the security measures and oversee their implementation (section 38 BSIG). Managers who breach this duty are liable to their entity for the damage under company law. Whether a D&O policy insures such a claim depends on the wording, in particular on any cyber or IT exclusion. The GDV model excludes damage arising from fines imposed on the company (A-7.10). Read the D&O policy and the cyber policy together.

The GDV model wording excludes claims brought before courts outside the EU or under non-EU law, and damage from breaches of non-EU law (A-7.5). It insures subsidiaries only if their seat is in an EU member state (A-4). If a foreign parent, investor or customer could claim against you, ask for the territory and the courts in writing, and check whether the parent's group programme also covers you.

Usually not. A new policy covers earlier breaches only if you did not know of them, and the GDV model counts a breach as known if you recognised it as possibly wrong or someone described it as wrong, even conditionally (A-5.2). The model also excludes matters that were already pending when the contract began (A-7.17). If you have a problem, report the circumstances in writing to your current insurer while its policy runs (A-5.4), and answer the new insurer's questions truthfully (section 19 VVG).

They may ask for it. A certificate of insurance shows that a policy exists, not what it covers, and it does not change the cover. The limit, the territory, the insured persons and the claims it responds to have to be read in the wording. We compare the request with your policy and tell you where a gap remains. Our page on US insurance clauses and certificates goes into the details.

That depends on revenue, the number of managing directors, the shareholders and their stakes, subsidiaries, territory, the sum insured, the deductible and the claims history, so a fair figure needs a short look at your company. Request the check and we will tell you what to expect.