Protect Your People and Business with D&O Insurance
Professional liability insurance for directors and officers helps protect your company or firm from risks not typically covered by general commercial liability policies. Just as medical practitioners need malpractice insurance, you need professional liability coverage for the directors and officers who run your business. Directors and Officers Insurance (also called D&O insurance) is an essential part of a comprehensive business insurance portfolio for your for-profit or not-for-profit operation. If you already have a policy, you should review it periodically to make sure it is up to date. As your business expands, it’s a wise idea to increase your coverage limits and reduce your exposure to claims.
Who Needs Professional Liability Insurance for Directors and Officers?
You need professional liability insurance if:
Your for-profit or non-profit operation has a board of directors and/or corporate officers
You sit on a board of directors
Your board of directors is sometimes faced with making unpopular decisions
The products or services provided by your company or firm are potentially controversial
What Professional Liability Risks Do the Directors and Officers of Your Firm Face?
Has your company ever been sued by its shareholders? Do you manufacturer high-profile or controversial products? Do you provide services that could put you in the cross-hairs for a law suit? Have your board of directors or officers ever had problems with independent contractors, vendors or employees?
The directors and officers of corporations and other business entities, whether publicly traded or privately held , have highly visible positions of great fiduciary responsibility. Increasingly, courts are holding directors and officers personally liable for abuse of authority, libel, slander, financial mismanagement and similar acts in law suits brought by shareholders, creditors, customers, employees, former employees and even people who have interviewed with a company or served as volunteers!
Non-profit organizations face special risks. While many corporations can afford to indemnify their directors and officers against law suits to a certain degree, non-profit organizations typically do not have the funds to mount a defense or to pay any settlements that may arise from a law suit.
What Does D&O Insurance Cover
D&O insurance covers the costs and damages resulting from law suits such as those mentioned above up to the limits of the policy. It is generally designed to help protect both the assets of the company and the personal assets of the individual board member or officer. D&O insurance normally covers liabilities that arise when an individual or group acts in the capacity of a director or an officer for business or practice. D&O insurance is not designed to cover small exposures. In most cases, a D&O policy’s deductible is sufficiently large that invoking the policy only makes sense when the firm is faced with significant allegations of fraud, fiduciary misconduct and other serious wrongdoing.
Affordable Quotes for Directors and Officers Professional Liability Insurance
Rates for D&O insurance are affordably priced. Depending on deductibles and other variables, D&O insurance can cost approximately $60 to $100 per employee per year. A typical deductible is $5,000. Many companies prefer a higher deductible, with a correspondingly lower premium, choosing only to invoke the policy when faced with a major lawsuit. As with any insurance product, higher coverage limits and an active claims history will result in higher premiums.
You can get competitive quotes from one or more insurance companies offering D&O insurance coverage by completing the form at the top of this page. If you don’t wish to purchase D&O insurance now, please leave your policy expiration date on the form provided. When your expiration date is closer, you will be contacted so that you can comparison shop for D&O insurance at that time.
Protect your business from exposure to risk. Get quotes for D&O insurance now.