Does Your Business Need D&O Coverage?
It’s a common misconception that Directors and Officers Liability Insurance (D&O) claims are mostly a public company occurrence Your company does not need to have revenues in the tens of millions of dollars for your directors and officers to be personally sued over their management of company affairs. In fact, smaller businesses with fewer assets may need the protection just as much as large, deep-pocketed corporations.
The D & O Policy Combines three unique coverages within one policy form. “A-Side” or Non-indemnifiable coverage, pays the loss of the individual directors and officers for covered losses in situations where the company may be unable to indemnify them.. B-Side” coverage reimburses the company for its indemnification obligations to its directors and officers pursuant to its charter, by-laws or other contractual arrangements. “C-Side” or “Entity” coverage provides direct protection for the company itself.
Remember D&O insurance is by no means a commodity product - there are many insurance companies offering this coverage and each utilize their own proprietary policy forms that – apart from the basic insuring agreements – contain unique terms and conditions. In general, coverage has improved substantially in recent years; however, each policy must be reviewed individually and tailored as necessitated by the risk profile of a specific insured. Give IBD Pro a call and let is help you find the policy to fit your needs.