Directors and Officers Liability in NJ

Are you and your principals protected against legal claims?

Directors and officers (D&O) liability insurance applies to anyone who serves as a director or an officer of a for-profit business or nonprofit organization, including public organizations, public companies, or financial institutions located in or around Eatontown and Medford, New Jersey.

Claims against school boards, city councils, and financial advisory boards have become increasingly common, and members find themselves personally named in these actions. To avoid liability, D&O liability insurance is needed.

Some directors and officers liability concerns include but are not limited to security violations, regulatory actions and allegations of misrepresentation.

Five Reasons for D&O liability coverage:

  1. Even though a person is volunteering in a service capacity, a director and/or officer can be held personally liable for claims. Organizations increasingly consider personal liability coverage as one of the most important aspects of their D&O program.
  2. Directors and officers liability claims related to regulatory actions increased for all types of organizations, representing 27 percent of claims in 2018.
  3. 43 percent of organizations desire added protection in the event their company becomes bankrupt and/or insolvent.
  4. Directors and officers and their respective companies or organizations are vulnerable to a wide range of claimants including competitors, shareholders, customers, employees and government entities.
  5. D&O insurance claims are increasingly common for private companies, public companies and nonprofits: 36 percent of all organizations reported claims in the last 10 years.

Regulatory Actions that include D&O Claims

Companies Looking for Added Protection

Companies with D&O Claims since 2009

Indemnification

Indemnification will protect company officials from lawsuits. This in no way replaces personal D&O, however.

An officer may be protected as long as they are employed by a corporation due to indemnification. If the officer is no longer employed by the corporation, but is still serving as an officer in another organization, the officer who is serving would still need D&O liability.

When individuals serve as corporate directors and officers, they face unforeseen litigation. If you are one of those individuals, and you want to stay on top of your finances and in control of your destiny, considering choosing directors and officers liability insurance.

Legal Fees

With proper coverage, directors and officers have confidence that their legal fees are paid and their personal credit reports are protected regardless of the outcome of the claim.

This liability insurance protects against any personal losses and reimburses for personal expenses.

If money is spent out of pocket, with D&O, all money will be reimbursed for legal expenses, travel and other costs incurred to defend against a lawsuit.

Contact our insurance agency to speak more about D&O liability coverage.

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