Directors and Officers Liability Insurance
Protecting the organization and your personal assets
Directors and Officers Liability insurance commonly referred to as D&O insurance is an often overlooked exposure to public or privately held for-profit and non-profit organizations. D&O litigation can be extremely costly regarding defense cost alone due to the usually long legal process involved in most cases. Five and six figure defense costs are not uncommon regardless of whether any compensation is ultimately awarded.
Another little known fact regarding D&O litigation is that not only is the organization’s financial assets at risk, but the personal assets of each director and/or officer are at risk too. In addition, North Carolina is one of several states that allow marital/spousal assets to be attached as a part of D&O settlement awards.
D&O lawsuits can originate from numerous issues. Mergers, acquisitions, sale of organizational financial assets, investment strategies, alleged unfair trade practices, and financial misrepresentations are just a few examples that often result in D&O litigation.
Officers and Board members of non-profit organizations are also potentially exposed to D&O claims and are subject to the same personal and spousal financial asset attachments should compensation be awarded to the plaintiff(s).
D&O insurance policies vary greatly in coverage features, benefits, limits, and exclusions depending on if you’re a for-profit or non-profit entity. Not all situations are insurable, but a careful review of proposals obtained should be conducted to ensure that the policy chosen best fits the exposures and needs of your particular organization.
Choosing an insurance professional knowledgeable in Directors and Officers Liability insurance can help you evaluate your potential D&O exposures and guide you in choosing the coverage that best protects your organization and you!
Gary Perry - Insurance Service of Asheville - firstname.lastname@example.org