As a business director or officer, you face a big risk. You make some of the most important business decisions and open yourself up to liability claims if your business faces a lawsuit.
What would you do if you were caught in your company’s lawsuit and facing huge court costs and fees? Can you and your personal assets be covered by insurance in that scenario? Fortunately, the answer is yes. Directors and officers (D&O) liability insurance will cover you and your assets if your organization is sued.
What is directors’ and officers’ liability insurance?
Directors and officers’ liability insurance can cover anyone who is the director or an officer of a for-profit business or nonprofit organization. It covers you as a director or officer against any personal losses, protecting your assets and your spouse. Also, it may cover your company for the legal fees, settlements, and other costs to defend you against lawsuits.
Your D&O insurance covers you if any legal action is brought against you, whether you are sued by employees, vendors, competitors, investors, customers, or other parties. Your coverage can even include criminal investigations or trial defense costs. However, the policies generally exclude coverage for any illegal acts or illegal profits.
What coverage types are available for D&O insurance?
When purchasing D&O insurance, you will typically find three types of insurance agreements: Side A, Side B, and Side C.
Side A coverage will pay for claims against you if your company is unable to pay or refuses to pay. Side B coverage, for when your company pays settlements for you, will cover your company for paying your legal fees. Finally, Side C coverage will cover the corporate entirety itself.
Do you need D&O insurance?
If you are a business director or officer, you probably do not want to face the huge court costs that could come from a lawsuit. So, yes, you need D&O insurance for your company.
Fortunately, Three/Arbor Insurance can help. We always strive to build relationships with our clients, provide reliable and timely responses, and be transparent throughout your entire insurance process. As an independent agency, we can help you find the right directors and officers liability insurance coverage for your company. Get a quote through our online platform and review your options with an agent. Or, if you want to discuss D&O insurance in person, contact us today!
