Directors and Officers (D&O) Liability Insurance is coverage that protects the Directors and Officers of a business during a lawsuit with regards to their performance or breaching of their duties, corporate contracts, or disclosure of conflicts of interest. This helps protects them from any stakeholder, customer, partner, vendor, employee, shareholder, regulator and creditor. Directors and Officers (D&O) Insurance pertains to the performance and duties of management while an Errors & Omissions insurance policy is related to negligence in products or services. Many companies choose to carry both forms of insurance.
Directors and Officers Liability Insurance is intended to protect the personal assets of Directors and Offices and these representatives of the company will demand a reasonable policy in order to ensure their safeguard against financial claims made by employees, stockholders, or clients. These claims are usually related to harassment and discrimination suits. A Board of Directors or Venture Capitalists will almost always propose this insurance be obtained.
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