The Protection Provided By Directors and Officers Insurance

Directors and officers insurance nonprofit protects the directors of nonprofit companies from damages resulting from alleged wrongful acts that they may have committed while in their position. Policies can also provide protection in the event directors make any errors, omissions, misleading statements, or breaches of duty. Some policies extend coverage to employees as well.  

Who Needs Directors and Officers Insurance

  Any company that possesses a corporate board or advisory committee should seriously consider obtaining this type of insurance. Claims from employees or clients can be made against any company. Since directors and officers are held primarily responsible for any company acts, they should acquire coverage rather than risk their personal assets.  

What Does an Insurance Policy Cover

  Directors and officers insurance nonprofit will cover any costs that are accrued over the course of civil, criminal, or administrative proceedings. In addition, most policies also cover defense expenses and financial damages or settlements. Policies will not cover wages, fines, taxes, or multiplied damages. The coverage limits on most insurance policies can range anywhere from $500,000 to $1,000,000 in claims, with a $5,000 deductible per claim.  

Why Companies Need to Obtain Coverage

  Every nonprofit company should consider obtaining directors and officers insurance nonprofit. The costs that accumulate over the course of a lawsuit can be immense. Having this type of insurance will prevent a company from sustaining extensive financial damage.

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