Directors and Officers Liability insurance provides financial protection for the directors and officers of a company in the event they are sued based on the performance of their duties as they relate to the company. Think of Directors and Officers Liability Insurance as a management Errors and Omissions policy.
Directors & Officers Liability insurance usually includes Employment Practices Liability and sometimes Fiduciary Liability. The former involves harassment and discrimination suits, and is where the majority of your exposure will be.
Directors and Officers Liability insurance is often confused with Errors & Omissions Liability. The two are not synonymous; Errors & Omissions is concerned with performance failures and negligence with respect to your products and services, not the performance and duties of management. Generally it is a good idea to carry both Directors and Officers Liability Insurance and Errors and Omissions Liability Insurance.
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