Directors and Officers Liability Insurance

Protect your senior leadership.

Directors and officers liability insurance provided by Executive & Global Insurance Risk Managers.

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Directors and officers liability insurance covers directors and officers for claims made against them while serving on a board of directors and/or as an officer. We’ll work with you to protect your organization’s greatest asset: your senior leadership.

Protection from bad business decisions.

Directors and senior officers in a business are paid to make big decisions, but if those decisions are wrong, things can get very costly. Directors and officers (D&O) liability insurance covers the costs of settling claims for damages that result from poor decisions. Usually, D&O policies cover costs relating to wrongful decisions, but not those decisions that are classed as criminal acts or that are designed to personally benefit the director.

What is covered by D&O liability insurance?

Examples of events covered by directors and officers (D&O) liability insurance can include mistakes or missing information in company accounts or other financial documents, or failing to properly enforce human resources policies. Depending on the state the business is based in—specifically, its rules on director indemnification—the policy could cover damages and costs paid by the individual or by the business.

Important policy options to consider.

It’s always important to check the details of a D&O liability insurance policy carefully, as the coverage period may detail when the claim against the person is made, not when the failing or mistake happened.

Coverages to Consider

Directors and Officers, Non-Profit

Directors and Officers Liability insurance is very important to non-profit organizations. These organizations rely on volunteers to make up their board of directors that make crucial decisions for the organization. Even though they are volunteers working in good faith, they are open to personal liability, which could put their personal finances in jeopardy. By understanding the risks involved and having D&O insurance, you will have a better chance of attracting and retaining quality board members. D&O insurance can help the organization, along with its members, overcome a wrongful act claim should the occasion arise. This coverage should also be extended to cover employment practices lawsuits that cover allegations of discrimination and harassment.

Directors and Officers, Public

D&O insurance for publicly traded companies is crucial protection. D&O insures the “behavior” in the decisions made by the directors and officers of the company, which may lead to covered claims. Your risks lie in actions brought on by private plaintiffs looking for a quick payout. Even innocent errors in judgment made by an executive can initiate a claim.

Directors and Officers, Private

While you may think you don’t need D&O insurance because you are a privately-held, family-owned company, think again. You are at risk of claims from stockholders, employees, and competitors that could bring a claim against the directors of your company. Remember, your general liability or commercial umbrella policy does not cover D&O or employment practices liability exposures. Legal expenses alone can put a company out of business, not to say what the damages awarded could do to your company.

Directors and Officers, Financial Institution

We continue to see banks across the country close their doors. We continue to see mergers and acquisitions in the banking industry. These activities can lead to a claim against the directors and officers of a financial institution. D&O Insurance can protect your personal assets for decisions made as part of a board of directors. If you have not looked at this important coverage in a while, now is the time to do so.

Directors and Officers, Fiduciary Liability

Are you the owner or officer of a company who makes decisions about the 401(k) plan for the company? Your personal assets could be at risk. You could be held personally liable for losses to a benefit plan incurred as a result of your alleged error, omission, or breach of fiduciary duty. A fiduciary liability policy can address these areas of concern.

If you’re looking to protect your business from potentially wrongful decisions made by directors and officers, then a D&O liability insurance policy could be a great fit. We can help you get started!

Directors and Officers Liability Insurance - Senior Leadership in the Boardroom

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