As a director or officer of a company, you have an important responsibility. It is important that you are protected from the consequences of claims that may arise from your involvement on the board. Directors and officers insurance through Toole Peet Insurance is the way to protect the board. With D&O Insurance, you have the coverage necessary to mitigate the costs and legal expenses arising from allegations of wrongful acts or negligence.
Any board decision that is made without this insurance in place increases your risk. You may assume that your general liability insurance policy would cover you for these actions, but such insurance policies are typically is restricted to claims arising from bodily injury and property damage. Contact Toole Peet Insurance today at 1-403-245-1177 or simply fill out the form above for your free D&O quote .
An Explanation of Directors and Officers Insurance
D&O insurance gives the directors and officers of a company financial protection in the event that legal action is ever brought against them for anything in conjunction with the performance of company related duties. D&O insurance often includes employment practices liability and sometimes also fiduciary liability. Employment practices liability relates to discrimination and harassment issues, which is where most of the exposure for D&O lies.
It is easy to confuse directors and officers insurance with errors and omissions insurance. However, the two are far from synonymous. Errors and omissions insurance relates to negligence and performance failure in relation to the services and products that a company provides. On the contrary, D&O insurance relates to the duties and performance of management personnel. Your Toole Peet Insurance broker will be able to help you determine if you need to purchase both types of insurance or simply directors and officers insurance to meet the needs of your business.
D&O insurance will protect your directors and officers in the event of administrative, civil, criminal and regulatory proceedings on the basis of wrongful acts, breaches of duty, errors, misstatements, neglect and omissions. This protection is provided through your D&O policy regardless of whether the acts are alleged or actual.
When Is D&O Insurance Necessary?
When a board of directors is assembled, you have a need for D&O insurance. Quite frequently, they will make the requisite. Investors, especially those that are venture capitalists, also often require a company to provide proof of D&O insurance as part of the prerequisites for them to provide financial backing for a company. One of the primary reasons to have a good D&O policy in place is because you have employees. All types of claims have been brought against boards; however, employment related claims are the most frequent. Having employees leaves members of management open to employment practice lawsuits, which are generally covered under a D&O policy.
Why Do You Need D&O Insurance In Alberta?
First of all, you need D&O insurance because the likelihood of claims being made against your company as well as company directors by clients, employees or stockholders is high. Because a director or officer may be held personally accountable for the actions of a company, it is highly recommended to purchase proper coverage in order to protect their personal assets which may be at risk.
In addition, you need directors and officers insurance because your investors and the members of your board are not going to willingly put their personal assets at stake. Regardless of how profound someone’s belief is in your company, they will not want to take the chance of losing everything that they have worked so hard to achieve due to a claim made against your business.
If you have a company that is publicly traded and you have an advisory committee or corporate board, you need to consider protection through a directors and officers insurance policy. Likewise, private companies and non-profit organizations may also benefit from the protection that this type of coverage provides. Directors and officers, including those of the past, present and future, need to be protected from damages that arise due to allegations of or actual cases of wrongful acts that they have committed while in an executive position with your company.
Building and growing a successful company is no easy feat. You have put in many long, hard hours to get to where you are today. The people that you have working with you have also worked hard for the assets that they have accumulated. A simple error or misunderstanding is all it takes to have it all taken away in the blink of an eye.
Directors and officers liability insurance is far less expensive that you might expect, so there is no reason to put off getting the coverage you need any longer. Get a no- risk quote right away. Simply fill in the short quote form and one of your expert brokers will get back to you quickly with a price for D&O insurance.