Directors and Officers Liability Insurance
Directors’ and officers’ liability insurance, also known as D&O liability insurance, is designed to protect directors and officers of your business against personal losses should a claim for compensation be made against them for alleged wrongful acts carried out in their capacity as directors or officers.
Comprehensive Directors’ and Officers’ Liability Insurance for Businesses
Directors and officers often have specific roles and responsibilities relating to their positions in the company.
If a director or officer is found to have carried out an alleged wrongful act such as a breach of trust, breach of duty, neglect or wrongful statements, then shareholders or third parties could make claims for compensation against them. Directors insurance helps cover any compensation payments and defence costs, safeguarding the personal assets of the directors and officers.
What Does Directors’ and Officers’ Insurance Cover?
D & O cover helps with legal costs and damages arising out of wrongful act allegations and lawsuits brought against directors and officers of an organisation. D & O claims are becoming increasingly common, and individual directors and officers are also at increasing risk of being held personally liable.
Do I Need Directors’ and Officers’ Liability Insurance?
Without directors and officers insurance, there is a greater risk of individuals in these positions not being able to defend themselves against civil/criminal proceedings or disqualification from their position of director following claims for compensation against them, leaving them vulnerable to personal financial losses.
Directors’ and Officers’ Liability Insurance FAQs
Directors’ and officers’ liability insurance is not a legal requirement, but it is a wise choice to protect directors and officers of your business against personal financial losses.
Without directors and officers insurance, there is a greater risk of individuals in these positions not being able to defend themselves against civil/criminal proceedings or disqualification from their position of director following claims for compensation against them, leaving them vulnerable to personal financial losses.
The cost of directors and officers insurance will depend on the level of cover you need, the industry you work in and the risks involved with your business.
