Check your directors and officers liability insurance, especially your Side A coverages. That is the probably wise advice being offered to policyholders in light of the recent memo sent by Deputy U.S. Attorney General Sally Quillian Yates in which she essentially orders U.S. attorneys general to actively pursue individuals as well as corporations for wrongdoing.

“One of the most effective ways to combat corporate misconduct is by seeking accountability from the individuals who perpetrated the wrongdoing,” says Ms. Yates in her memo.

Among the steps she tells U.S. attorneys general to take is requiring companies to provide “all relevant facts” about the individuals involved in corporate misconduct before they can get credit for their cooperation.

Bluntly put, corporations may be put in the untenable position of hanging their executives out to dry to save themselves.

No one knows for sure to what extent this may be a public relations move intended to soften some of the harsh criticism levied against the federal government for its failure to successfully convict higher-ranking executives in connection with the credit crisis of several years ago.

As a result, it is possible everything will quiet down after the U.S. Justice Department obtains guilty pleas from a few token unfortunate individuals set up to be examples for everyone else.

But in the meantime, this could create significant problems. More investigations means higher costs. And it may lead many executives to conclude their interests and those of their corporations are not necessarily perfectly aligned, leading them to hire their own counsel, which of course will also boost defense costs.

Further complicating the situation is that it is more difficult to prove wrongdoing against individuals than it is against corporations.

For now, insurers are expected to take a wait-and-see attitude to see how this all shakes out. And even if all this should have an effect on costs, the continuing soft market could ameliorate its impact.

Nevertheless, it is hard to see a bright side to the entire situation. All policyholders can do for now is to be sure they have all the coverage they may need in place — and hope that it isn't long before this latest government initiative inevitably runs its course.