LLC Reimbursement, Indemnification, Advancement, and Insurance Requirements in Wyoming
At a glance
| Governing LLC law and scope | Wyoming LLC Act, Wyo. Stat. §§ 17-29-110, -408: company-payment reimbursement, liability indemnity and status insurance; no separate defense advance in § 17-29-408 |
|---|---|
| Covered people and capacities | Member of member-managed or manager of manager-managed LLC for reimbursement/indemnity; member or manager for insurance; no express former-status term (§ 17-29-408) |
| Company-payment reimbursement | Must reimburse covered person for payment made in company activities if §§ 17-29-405 and -409 duties complied with (§ 17-29-408(a)) |
| Indemnification and conduct limits | Must indemnify covered person for debt, obligation or other liability incurred in company activities if §§ 17-29-405 and -409 duties complied with (§ 17-29-408(a)) |
| Expense advancement and repayment | § 17-29-408 does not prescribe defense-expense advancement, undertaking, or repayment terms |
| Insurance purchase authority | May buy and maintain insurance for member/manager capacity or status liability (§ 17-29-408(b)); no express nonindemnifiable-conduct extension in that subsection |
| Approval and court procedure | § 17-29-408 prescribes no special approval or court route; ordinary member/manager majority decisions follow § 17-29-407(b)(iii), (c)(iii) |
| Agreement control and survival | Agreement governs member/manager rights and company activities; chapter fills gaps (§ 17-29-110(a)–(b)); § 17-29-408 does not state a former-status survival rule |
| What the statute does not decide | Actual capacity, duties, claim nexus, agreement terms, payment reasonableness and policy coverage require case-specific review |
Requirements one by one
Company payments and liabilities
Under § 17-29-408(a), the LLC must reimburse a payment made and indemnify a debt, obligation, or other liability incurred by a member of a member-managed company or a manager of a manager-managed company while acting for the LLC. The condition is compliance, when making the payment or incurring the liability, with the duties cited as W.S. 17-29-405 and 17-29-409. Section 17-29-405(a) addresses improper distributions, while § 17-29-409(c)–(d) states care and good-faith standards. A claim against a person therefore is a distinct question from repaying a payment made for the company.
Insurance and agreement control
Section 17-29-408(b) permits the LLC to buy and maintain insurance against liability asserted against or incurred by a member or manager in that capacity or arising from that status. Under § 17-29-110(a)–(b), the agreement governs member and manager relations and company activities, with Chapter 29 supplying the rule where the agreement does not address a matter.
What trips people up
Section 17-29-408(a) requires compliance with both cited duty sections; a person's office alone does not establish entitlement. Section 17-29-408(b) authorizes insurance purchase but neither guarantees coverage nor states that a policy may cover conduct for which indemnity is unavailable. The section contains no separate defense-expense advancement procedure, undertaking, special approval process, court route, or former-status survival language. Ordinary company decisions are governed by § 17-29-407(b)(iii) and § 17-29-407(c)(iii), subject to the articles and agreement.
Common questions
Can an LLC insure a manager? Yes. Section 17-29-408(b) expressly names a member or manager; actual policy coverage depends on its terms.
Does the statute require an advance for lawyer fees before a claim ends? Section 17-29-408(a)–(b) addresses a company payment, a debt or liability, and insurance. It does not prescribe an interim defense-expense advance or a repayment undertaking.
Statutes and sources
- Wyo. Stat. § 17-29-110(a)–(b): agreement scope and chapter gap rule. Official Title 17, accessed 2026-09-23.
- Wyo. Stat. § 17-29-407(b)(iii), (c)(iii): ordinary member and manager decisions. Official Title 17, accessed 2026-09-23.
- Wyo. Stat. § 17-29-405(a) and § 17-29-409(c)–(d): distribution, care and good-faith duties cross-referenced by § 17-29-408(a). Official Title 17, accessed 2026-09-23.
- Wyo. Stat. § 17-29-408(a)–(b): company-payment reimbursement, liability indemnity and insurance purchase. Official Title 17, accessed 2026-09-23.
Source links
Every statute quoted above, linked, with the date we checked it.
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