Company directors have numerous responsibilities and obligations, some of which require them to make decisions that expose them to liability claims. There’s a lot resting on the shoulders of directors and officers of companies and non-profit organizations: wrongful dismissal, bankruptcy, defamation... these are just a few liability situations you might be faced with.
To ensure your business and your key business team members are protected, you require the right insurance products, one of them being directors’ and officers’ insurance.
Directors and officers liability insurance, also known as management liability insurance, covers damages involving wrongful acts committed in the discharge of your duties, including: negligence, misconduct, errors and omissions, breach of duty, misleading statements or any other act that could be held against you in your capacity as a director or officer. In the event of a lawsuit, this protection would cover legal fees to defend yourself.
Statistics show that more than one in every four private companies experience a D&O claim within three years. The companies without directors’ and officers’ insurance policy that face a claim incur a loss of at least $400,000. Statistics show that shareholders and employees are the most likely group to sue private companies. Other parties may bring suits, such as the corporation itself, competitors, creditors, regulatory bodies, etc.
With that said, having a D&O policy for your company offers the following benefits:
D&O insurance can provide reimbursement to leaders of private companies following allegations of wrongful acts, breach of duty, financial mismanagement, errors in judgement and negligence
When running an organization, you can’t deny the ever-growing need to find the best directors and officers to lead your business. Directors’ and officers’ insurance policy is one way that can help you attract the best talent to your organization.
Directors and Officer Insurance policies are generally purchased by the organization to cover a group of individuals rather than by the individuals themselves. Working with our one of our experienced brokers we can help you find a policy that meets your unique needs.
D&O policies can take different forms, depending on the nature of the organization and the risks it faces. We can offer a D&O solution for you company or organization regardless of size or structure
To help businesses better understand the level of risk their directors and officers face, OTC Insurance has developed a Directors and Officers Liability Scorecard. After you have completed the scorecard, there is a key that helps you determine your level. To download the Scorecard, simply complete the form and we’ll send you your free, no-obligation copy.