As a director or officer of an organization, you are answerable to many people. As such, it’s easy to imagine that your employees, your shareholders, the other directors and officers on the board, and the customers of the companies you represent could complain about your actions or make certain uncomfortable, even if untrue, accusations.

In this litigious society it's important that you protect yourself against any accusations that you're exposed to, as well as the cost of defending yourself against them, with directors and officers liability insurance.

What does Directors and Officers Liability Insurance Protect Against?

When a shareholder, employee, or customer makes a complaint against a company, they may or may not include the name of a director and/ or officer in the claim. As a director of the company, that means you could be held personally responsible for actions that the company or another associate has taken. Liability insurance protects your personal assets from these professional decisions and activities.

In some cases directors and officers liability insurance also includes protections specifically for fiduciary liability and employment practices liability. This will protect you against claims involving harassment and discrimination, as well as accusations that you did not act in the best financial interest of the company you represent.

But directors and officers liability insurance doesn't just protect you from claims leveled against you; it also protects you against the expensive but necessary cost of defending yourself against the claims, allowing you to avoid tapping into personal savings.

As the director or officer of an organization, you have tremendous sway in the policies and activities of that company. However, you do not have control over the behavior and activities of everyone in the organization. So even if everything that you do is above board, you could still be held responsible for the actions of others. To protect your personal assets from this potential exposure, give us a call at McFarlin Insurance Agency and allow us to take a look at the policies available to you through our Maryland Business Insurance.