Directors and officers liability insurance (D&O) is a policy that is intended to protect individuals from personal losses if they are sued as a result of serving as director or officer of a business or organization. D&O insurance can cover the legal fees and other costs that may incur as a result of a lawsuit. This insurance policy is paid to cover the losses that are associated with the lawsuit, such as legal defense fees and time off work.
You may sign up for directors and officers liability insurance if you serve as the director, or an officer, for a for-profit business, or non-profit organization. It insures against potential personal losses as the result of being sued. This insurance can also help to reimburse a business or organization for legal fees that incur in defending a director or officer against lawsuits.
The claims are paid to directors and officers if any legal action is brought against them. This coverage can also extend to criminal investigations or trial defense costs. Depending on the nature of the organization, and the risks that it faces, D&O policies can take different forms. It’s always best to contact your Staples Agency insurance provider to review what exactly your D&O policy will cover.
Directors and officers policies are usually purchased by the organization to cover a group of individuals who serve as directors and officers, rather than the individuals themselves. A D&O policy can be written to insure against a variety of situations and hazards, but generally, this policy makes exclusions for fraud, criminal activity, and illegal profits.
Should your business enroll in D&O coverage? Contact an agent at Staples & Associates for more information on how you can protect your business.