Insure Your Assets. Protect Them From Liabilities

What Is D&O Insurance And  Its Types?

What Is Directors And Officers Liability Insurance?

Director and officer liability insurance refers to insurance coverage that protects a director or officer from the cost of legal expenses as a result of a claim made against their service. The insurance that you can get with the help of an insurance broker in Brisbane covers the personal losses of these professionals that they may have to experience as a result of making an error in their service and being sued for that. It may include the cost of legal fees or other expenses related to the legal issue. 

Understanding Directors And Officers (D&O) Liability Insurance.

The D&O liability insurance is responsible for the coverage of any individual who serves as a director or officer in any non-profit or for-profit organisation. The insurance falls under the category of professional indemnity insurance, which reimburses the cost of a legal fee or other expenses that the organisation experiences in the process of defending itself against a lawsuit. 

If legal action is taken against a director or officer of an organisation due to any reason, the expenses to fight the case and hire a lawyer are reimbursed by the D&O liability insurance. The insurance coverage can also be extended to reimburse for criminal and regulatory investigation or trial defence costs. In an organisation, often, the directors and officers are the ones to whom civil or criminal actions are brought against. 

Types Of Directors And Officers Liability Insurance.

There are three types of insurance agreements that you can get with the help of an insurance broker in Brisbane under the D&O insurance policy, which is termed Side A, Side B and Side C. 

Side A

This type of coverage takes place when the company refrains from paying the amount for the legal expenses or is unable to afford the payments. This can happen in the case such as if the company declares a shutdown or bankruptcy. The director or officer are the ones who are insured under the side A coverage as their personal assets are at risk, so the personal loss they experience will be covered by the insurance provided by a business insurance broker in Brisbane

Side B

The Side B insurance coverage holds the responsibility of reimbursing the company against the legal costs. Under this policy agreement, the company grants indemnification, which means, in this case, the company is the one insured for its corporate assets being at risk. In simple terms, with the side B coverage, the company agrees to compensate the cost of legal liabilities that the director or officer may face during their service for the company.

Side C

This insurance policy agreement is for entity coverage, which means it protects the company as a whole against its legal liabilities. This means that any legal actions that are taken against the director, officers or any other assets of the company would straight be handled by the company, and the cost of losses will be covered by the D&O liability insurance provided by a business insurance broker in Brisbane

The type of insurance policy you wish to get depends upon several factors, such as the knowledge of the difference between public and product liability insurance, the size of your organisation, the scale of your business, the number of employees, directors and officers and many more. It is ideal to seek an expert insurance broker in Brisbane to have a thorough understanding of the type of insurance policy that would suit you the best. Understanding the policies would make it easier to customise them based on certain needs and preferences of your business. 

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