This topic was mentioned in Condo Cases Across Canada, Part 15 (August 2006). At that time, I pointed out that D&O insurance generally will not cover a claim if the potential for the claim was known before the commencement of the insurance policy. This is one of the important principles discussed in the case of Boland v. Allianz Insurance Company of Canada.
The good news is that the Court of Appeal (in the Boland case) has confirmed that the “effective date of the policy” for these purposes is the commencement of the very first policy (if the insurer has provided continuous coverage by means of a series of policies).
In any event, I recommend the following cautionary practice: If you know of a potential D&O claim, it may be best (if possible) not to change D&O insurers.
Boland v. Allianz Insurance Company of Canada (Ontario Court of Appeal)