This document discusses various issues relating to directors' and officers' (D&O) liability and insurance coverage. It addresses the duties of loyalty, care, obedience and good faith that directors and officers owe to the corporation. It also examines covered risks and obligations under D&O policies, exclusions for fraud, known losses and contractual liability, and implications of bankruptcy proceedings on insurance coverage. The document uses examples to illustrate gaps in coverage and how insurers may attempt to deny claims.