End of the World Insurance

I call excess side A coverage on directors’ and officers’ insurance policies, “end of the world insurance.”
Your company’s by-laws includes an indemnification agreement that says that the company will pay for any litigation against a director or an officer over their service as a Director or Officer. (Note: There are legal restrictions on what can be indemnified.  The indemnification language of the bylaws should be reviewed by your attorney every three to five years to keep up with current court cases, changes in law, etc.)  In effect, the company’s assets protect the directors and officers.
Your company’s directors’ and officers’ insurance reimburses the company for payments made according to the above indemnification.  The D&O policy also pays if there is a covered claim that cannot be indemnified due to some reason of law (pretty rare).
If there are no more company assets left (insolvency, though rare, is the most likely reason the company is not able to indemnify a director or officer), the D&O insurance would pay claims against directors and officers.
Here is where the end of the world comes in:
Let’s say all the assets of the company are gone.  The insurance is also used up, but there are still claims against the directors…
The correct name for End-Of-The-World-Insurance is Excess Side A – side A being the section of D&O insurance where non-indemnified claims are paid.
This is coverage for your Ds and Os if all else fails.  It’s the supply of water in the basement we all know we should have.  It’s there for the same reason that we still are told what do do if the plane is going to crash – even though it is almost impossible that the plane will crash.
Consider the value of End-Of-The-World-Insurance.