Directors’ and Officers’ Insurance Coverage
Running a company is a big responsibility with many risks and a great deal of liability to consider. Directors’ and officers’ insurance protects you from becoming a target should your company run into trouble.
The directors and officers of a company are looked toward by a variety of individuals and entities outside of the people you employ. This includes:
- Company shareholders: The shareholders of your company have a stake in the success of the business. Should problems surface, they will look to directors and officers for answers.
- Regulatory Figures (government agencies): Depending on the trouble encountered, government agencies may call upon those liable to pay.
- Consumers/Clients: The people you serve also want a say in how your business is run and may look for answers from a director or officer.
- Lenders: Running a business takes a great deal of money, and most companies have ties to one lender or another. If financial hardships occur, are you covered as the director or officer of a company despite your leadership role?
Directors’ and officers’ insurance protects you in situations where liability toward the above individuals and organizations surfaces.
Considerations Of Directors’ and Officers’ Liability Insurance
Directors and officers liability insurance offers protection against financial loss in the event of legal issues relating to the business you work for. There are several features of directors’ and officers’ insurance, including:
If a lawsuit is filed, your directors’ and officers’ insurance policy reimburses or prevents loss when claims are made against the company or yourself. This extends to the cost of defense if the claims proceed to court.
In the event of an omission, mistake, or misleading, your policy provides security to prevent financial penalization.
If a suit is filed against directors and officers, liability coverage involved with your directors and officers insurance nonprofit policy extends to support the company financially.
A directors’ and officers’ liability policy does not cover criminal misconduct such as fraud or illegal earnings. It is important to carefully select the coverage which best suits your company and officers. Working with a broker you trust is important to ensure the fine print is brought to light, and you know exactly what your policy covers.
Reasons You May Be Targeted
At Cluett Insurance, we follow Canadian insurance laws closely, so our clients know exactly what directors’ and officers’ insurance covers and what extended policies you need in place. There are many reasons you could be targeted by an employee, shareholder, or another party, including:
- Employee Interactions
- Failure to Pay
- Government Investigations
- Environment Accusations
- Fraud Claims
- Debt Management
- Discrimination Claims
- Tax/Financial Discrepancies
Whether these claims are made wrongfully, or with some truth to them, your directors’ and officers’ insurance policy keeps you protected.
Why Choose Cluett For D&O Liability Insurance?
Cluett is a leader among Canada’s D&O liability insurance brokerages. With more than four decades serving Atlantic Canada, we are constantly striving for improvement. As a local insurance brokerage, it is important to us to support the economy, and our corporate clients are the backbone of that economy.
If you are a director or officer, or a company looking for coverage to protect your directors and officers, Cluett will get you covered. Call us at (902) 466-5328 for more information.