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Directors & Officers Liability (D&O)

The Basics of Directors and Officers Liability Coverage

The actions of business directors and officers can have a direct impact on the reputation of the business. This is why some businesses choose to carry Directors and Officers Liability Insurance (“”D&O””). The policy provides financial assistance that helps a business deal with harmful actions performed by certain employees acting on its behalf. Coverage is generally intended to cover company officers, directors, and anyone in a position of power.

Why D&O Liability is Worth Considering

Bad behavior exhibited by even one person in power can ruin a business. Owners, managers, board members, officers, and directors are people who can possibly ruin a business with one bad judgement call. The fallout can almost be just as bad if one of these people is falsely accused of bad behavior.

D&O coverage helps the company by providing financial support for legal costs associated with their defense. Coverage also extends to helping with defense costs in the event of a criminal investigation. But the insurance will not help in a situation involving intentional criminal acts.

D&O Coverage Benefits

Lawsuits are common in the business world. People in positions of power are not exempt for being taken to task for their actions. And accusations, even if false, can quickly spread via social media and the internet. Because of this, a company might want to consider D&O coverage to protect themselves in the event of a liability issue arising.