If you are the owner of a business, you should know that you're always at risk of a D & O Insurance claim.Shareholders, customers and even employees can bring claims against your company for a variety of reasons. The following are the various sources of directors and officers insurance, and your company could face one of these claims in the near future if you're not careful.
Partners, Investors and Shareholders
Everyone associated with your company, including directors, partners, shareholders and even venture capitalists and investors, can bring mergers and acquisitions insurance claims and even claims against financial performance, among many others. There are also conflicts of interest, bankruptcy, inadequate or inaccurate disclosure and financial reporting claims that have derailed many companies who didn't have the proper directors and officers insurance policies in place.
Your Company's Clients
Customers, clients and even consumer groups are often suing companies for extensions or refusals of credit, for debt collection, for deceptive trade practices, for contact disputes, restraints of trade, dishonesty and more. Customers and clients can also sue for the cost or quality of the company's products and services and for lender liability.
Third Party Claims Against Your Company
There are many third-party lawsuits brought against companies and the companies' directors and officers for anti-trust reasons, for copyright and patent infringement, for business interference, for competitor disputes, prospective company acquisition, tax issues and even for regulatory or other government issues.
What Claims Can Cost You?
If your company has a directors and officers claim brought against it and you're lacking the proper insurance, you can find yourself facing bankruptcy. Most directors and officers insurance are very expensive the company may not be eligible for corporate indemnification. Not only that, but your company may find it difficult to attract qualified talent to your boards without the proper directors and officers insurance policy in place. These are the perfect reasons to speak to your business insurance provider about protecting your business against all risks it may face.
How to Protect Your Business
Now that you know the various sources of directors and officers insurance claims, you should speak to your business insurance provider about securing the proper policy. When you secure D & O insurance, you will protect your company against any financial uncertainty.
What You Get With D & O
When you secure the proper Business Insurance policy, you will receive access to adequate capital in order to defend your company against claims and lawsuits, you'll be able to keep up with new and emerging technology including internet growth, you'll be able to protect your company's intellectual property assets and you'll be able to retain qualified workers.
Most directors, investors and venture capitalists are going to require that your company carries the proper directors and officers insurance. Those individuals can be held personally liable if there is ever a claim brought against your company. Protect your interests and your assets with the proper policy to protect the above claims from being brought against you and your directors.
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