Directors & Officers Insurance

Business Insurance for Directors & Officers Liability

Directors and officers liability insurance protects executives, board members, and managers from personal liability arising from their decisions and actions while managing the company. D&O coverage responds to claims alleging wrongful acts in their corporate capacity, protecting personal assets from judgments and legal costs.

Why Your Business Needs This

• Executives face personal liability for management decisions that harm shareholders or employees
• Employment practices claims increasingly target individual decision-makers
• Qualified candidates may refuse board positions without D&O protection
• Defense costs for securities claims can exceed available personal assets

What It Covers

D&O insurance covers claims of breach of fiduciary duty, mismanagement of company assets, failure to comply with regulations, employment practices violations, shareholder disputes, and misrepresentation in company communications. Coverage includes defense costs, settlements, and judgments against individual directors and officers. The policy typically includes Side A coverage for individual directors, Side B coverage reimbursing the company for indemnification payments, and Side C entity coverage for securities claims.

Who Needs D&O Insurance?

Corporations, nonprofits, private companies, and partnerships with formal boards or executive teams need D&O coverage. Publicly traded companies face the highest exposure, but private companies increasingly face claims from investors, creditors, and employees. Even small businesses with outside board members should consider D&O protection.

Does the Company or Individual Pay Premiums?

The company typically purchases and pays for D&O insurance as a benefit to attract and retain qualified leaders. This coverage is considered essential to recruiting talented executives willing to accept the risks of leadership positions.