Individuals serving as directors or officers on boards of non-profits, private companies, and public corporations are accountable for actions and inactions of the organization with which they serve.
Whether statutory liabilities, breach of duty, or wrongful allegations of breaches, all can put the company in question under a spotlight and in an uncomfortable legal position. An efficient means of protection under these circumstances is to purchase Directors and Officers Liability insurance.
Why Buy Directors and Officers Insurance?
In the event of a lawsuit, the protection provided by the Directors and Officers Liability Insurance would cover defense costs and any potential awards or settlements arising from successful litigation.
With insolvency or wrongful act lawsuits on behalf of a director (resulting in legal process), Directors and Officers Insurance ensures that they would have the legal defense and indemnification if found liable.
Non-profits, in particular, have limited resources with which to respond to indemnification claims. This would put the personal assets of the office staff at risk, along with the assets of the organization itself.
Directors and Officers Insurance for Private Companies
Public or private companies have the same exposure risk. Conflicts of interest, allegations of misrepresentation, and breaches of fiduciary duty – all hold the same weight in court.
Prudent companies buy Directors and Officers Liability Insurance to protect themselves from any and all instances where legal proceedings and potential payouts would cause severe financial distress to a private organization.
When Is Directors and Officers Insurance Needed?
The most honest answer is now! Put a policy into motion before any instances arise where your fiscal ability to survive them may be challenged, and your organizational reputation is put to the test.
Call Huronia Insurance Group today and speak with one of our informed and knowledgeable business insurance brokers. Let us help you protect your small business, non-profit organziation, public company or private company. We also do umbrella liability insurance. Call 1-866-955-8386
Our insurance brokers will be able to provide you with information on a policy most applicable to your organization and explain all the procedures necessary to secure the best coverage. You can also reach us by filling out our online contact form or by sending us an email.