D&O liability insurance is also known as directors and officers liability insurance in New York City. This type of insurance can protect individuals who hold decision-making jobs in any given field or workplace. Policies do tend to vary, however, which is why it is important to purchase your insurance from a quality company such as Gross and Company Insurance. Read on for the answers to some of your questions about D&O liability insurance.
What is D&O Liability Insurance?
Directors and officers liability insurance are designed to protect individuals who might be legally targeted and held personally responsible for a corporate decision or mistake. If you hold a director or officer position or you make decisions for your company, there is always a chance that another person or entity will file a claim against you personally. Whether the claim is justified or not, this can result in extensive legal fees that you may not be able to afford on your own. Fortunately, directors and officers liability insurance can cover you by reimbursing you for these expenses. This can make directors and officers more comfortable and able to focus on their jobs.
Does the Policy Cover Past Acts?
Just like other types of insurance, individual directors and officers liability insurance will vary from policy to policy. In some cases, the insurance will only protect an individual throughout the duration of the policy. This means that you will not be covered for acts that were committed before you purchased the insurance. However, some policies will cover you for acts that you have committed in the past. It is important to go over the details of your insurance policy with your agent to make sure that you fully understand your agreement.
When is D&O Liability Insurance Necessary?
It is wise to have directors and officers liability insurance if your company does not indemnify its directors and officers. While indemnity would reduce or eliminate the need for this insurance policy, many companies are financially incapable of offering their directors and officers this service. This insurance can keep your assets safe if you find yourself in legal trouble.