April 19, 2023
Common Misconceptions about Directors and Officers insurance
One of the major misconceptions about Directors and Officers insurance is that it’s only for publicly traded companies or non-profits. Chubb Insurance recently addressed this and other misconceptions:
D&O is unnecessary because your business is privately-owned.
Privately-owned companies face virtually the same exposures as publicly traded companies, but private company D&O policies can insure much more than securities litigation.
We don’t need D&O insurance because our business is family owned.
Family driven lawsuits can be more contentious and expensive to defend given their personal nature and the fear of exposure to the public.
If my company is sued, the cost to defend the lawsuit will be minimal.
Legal expenses and average settlements have risen significantly over the past 10 years. D&O insurance shields balance sheets and personal assets from expensive litigation costs.
I have D&O coverage under other commercial or personal insurance policies.
There may be limited coverage on other insurance policies, but a dedicated D&O policy can provide a broader breadth of coverage tailored to meet your company’s specific needs.