An exclusion in directors and officers (D&O) liability policies that precludes
coverage for claims brought in conjunction with a corporation's restatement
of its financial data. The rationale for this exclusion is that when a restatement
is necessary, it is a strong indicator that either information was intentionally
omitted from the original financial statement or data was willfully falsified.
In either instance, the need for a restatement is normally caused by conduct
far beyond mere negligence on the part of the organization's directors and officers.
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