Stop falling for these director & officer liability myths! Get the truth today.
In our litigious age, director & officer liability insurance is becoming more and more common. Unfortunately, information about it isn’t as widespread. We want to take a moment to clear up some common misconceptions about this type of coverage. Stop believing the D&O liability insurance myths today!
My small business doesn’t really need it.
Too many business owners assume that they can decide to forego D&O coverage because they’re not running a major corporation. In reality, the size of your business doesn’t determine your level of need for this protection. What you actually need to consider is whether or not you should protect your board. If your board of directors doesn’t want to put their personal assets at risk to become professionally involved with your business, you’ll need a D&O policy.
My board members have their own protection.
Yes, your board members have some liability coverage from their homeowners insurance. The operative word here is some, though. To begin, those liability limits probably aren’t high enough to protect them if an issue arises due to their work with your business. Additionally, their personal insurer probably won’t cover their professional ventures.
A higher dollar limit provides the best protection.
Although it’s important to set your D&O policy limits high enough to fully protect your board, that number isn’t the most important factor. Don’t overlook the importance of breadth of coverage. A policy that insures your board against a broader spectrum of risks could actually be better than a higher dollar limit policy that protects in limited situations.
Now that you know the truth about director & officer liability insurance, are you ready to get yours? To protect your board and your business, contact NorthStar Risk Management & Insurance Services, Inc. in Walnut Creek, California.