Facts About Liability of Directors of a Company and Company Directors Liability
What is the liability of directors of a company face? Is company directors liability a major risk? How can a business best protect liability of company directors.
When Is a business at risk for liability of directors of a company?
If your company has a board of directors, then you need directors and officers liability insurance. D&O is an important part of a corporate insurance policy for major companies. D&O is a liability policy that protects the company directors liability in the case of a legal action. Company directors liability protects the board of directors financially so their personal assets are not at risk and to cover the costs of the legal defense.
Who would file a lawsuit against the board of directors causing liability of company directors?
These days we live in a lawsuit happy society. Many major corporations and their directors and officers have experienced an increasing number of claims and larger settlements. That means that private companies may face damages in a result in claims being brought against the company and the people who manage it.
That puts company directors at risk from a legal action files by customers. Or unhappy stockholders may sue the board of directors for a loss in earnings. The board of directors can even be at risk of being sued by a disgruntled employee. That’s why having directors and officers liability insurance is so important and necessary protection as part of a commercial insurance policy.
What is the biggest reason why liability of company directors needs protected?
Over 50% of claims against a company are employment practices related. Claims for discrimination, wage disputes, sexual harassment, and wrongful termination are commonplace.
Factors affecting the risk of liability of directors of a company
The specific risk liability risk for company directors varies depending on many factors including:
- size of the company
- industry
- being publicly or privately owned
- number of shareholders
- amount of assets a company holds
Obviously the more someone stands to gain from suing the directors and officers, the bigger the risk and the need for D&O liability insurance. When you think about the cost of defending your company from claims plus the risk of a major settlement against your firm, you wonder how a company can afford not to carry a D&O policy.
Get the important protection for liability of directors of a company today!
For over 100 years, WM Schwartz has been helping corporations and companies like yours get liability protection for their company directors with a D&O policy designed to fit your business needs. We can help you assess the risk and help provide the risk protection you need. Call us today for a quote for D&O insurance to ensure that the liability of company directors is covered.
Don’t worry about the liability of directors of your company. Call us today at 847-996-0002 for a free quote on a D&O policy today. Or get a free D&O liability insurance quote online now.