Directors and Officers Insurance
Making sure your staff is part of a tightknit group is key to keeping the business running smoothly as a fully trustworthy operation. Making sure your team and employees are honest in their daily activities will encourage customers to return again and again. It provides a sense of unity and a welcoming environment for all to participate. But it all stems from the top — whether that's a manager, director, advisor or officer.
To keep the good leaders around and filter out the not-so-great, take advantage of legal protection like directors and officers insurance to keep leadership strong and reliable.
What Is Directors and Officers Insurance?
Directors and officers insurance provides a wonderful way to keep your best leaders around when a legal issue arises. It happens every once in a while — a director or manager will be accused of ill intent or discrimination in areas that are either running a fine line or clearly illegitimate claims. To fight for these directors and make sure they stay part of your company, invest in this coverage. Doing so will help with legal and defense fees.
This insurance policy is a liability insurance that's paid as reimbursement for any losses accrued or in advance for any defense costs. Under this reimbursement policy, the insured member will receive a monetary loss due to their alleged wrongful act as they held a title of a director or officer.
An important note concerning this type of coverage policy is that the legal claim must be a viable wrongful act. Any criminal investigations or trials for a wrongful act will be paid for through this reimbursement. However, if an intentional illegal act is discovered through trial or investigation, the coverage is dropped, and the director or officer takes full legal responsibility for their actions.
What is considered a genuine alleged wrongful act? The following scenarios will be protected under directors and officers insurance:
- Damage caused to the company or persons due to a breach of legal duty
- The mixing of personal assets with company-owned business assets
- Failure to disclose conflicts of interest
- Innocent errors of judgment by the acting director or officer in charge
How Directors and Officers Insurance Protects Your New York Business
Directors and officers insurance protects both your company and your leaders by paying for settlements, defense costs and related expenses in the event of a lawsuit. This coverage is the financial underpinning for a standard indemnification provision, which protects leaders from taking on liability for losses related to their position in an organization. By providing both indemnification and directors and officers liability coverage at your New York company, you offer your directors and other leadership peace of mind.
Officers and directors can be sued for many reasons, including misuse of funds, misrepresentation, breach of contract, fraud, violation of workplace laws, breach of fiduciary duty, poaching, poor governance, intellectual property theft and other claims. In all these cases, directors and officers insurance for private companies in New York is needed to ensure your team members and company are protected.
A directors and officers liability insurance policy for your New York company protects your board members, officers, directors and other decision-makers in the event of a claim. It also protects your organization from high defense costs, extradition expenses, penalties, judgements, bail bond costs, settlements and other damages.
Benefits of D&O Insurance
Important benefits come from adding directors and officers insurance to your existing coverage plans. The first would be retaining strong leaders within your business. By offering this insurance coverage, you're more likely to gain and secure directors and officers. Without the coverage, they're exposed to their own personal liability, which might be too risky to get involved in.
Secondly, directors and officers insurance will attract investments from outside corporations. Before entering into and investing in a partnership with you, other companies will look to make sure they're covered. Additionally, having this insurance can cover substantial legal fees. If your director or officer is accused and found guilty of exoneration, your company may face larger charges — which can, fortunately, be covered by this insurance reimbursement.
In addition to choosing the right directors and officers insurance for your New York business, you can take other steps to ensure you reduce your liability. Your business can create written expectations and policies for leadership positions so that each member of your team understands what is expected of them. Careful screening, background checks and hiring practices also help you choose leaders and executives who not only contribute to your organization but also remain honest.
Companies can also create built-in transparency and accountability measures to ensure team members are aware of each other’s actions and stay responsible to one another. While these steps will not eliminate your need for a directors and officers liability insurance policy for your New York business, they can reduce your risk of a claim.
Why Directors and Officers Insurance Matters for Private Companies, Small Businesses and More
Many companies assume that only large public corporations are at risk of lawsuits targeting directors and officers. While the news tends to focus on lawsuits against the leadership of public corporations, it's still the case that small businesses, private enterprises and even non-profits all face liability risks in this arena and need directors and officers liability insurance for their New York and other locations. In fact, smaller companies with fewer assets may be more at risk than their larger counterparts and may need coverage even more.
Some industries face special needs for this type of insurance. Directors and officers liability insurance for hotels in New York, for example, can be important because of the competitiveness of this industry. Some directors and officers in the hospitality industry can make poor choices due to the need to remain competitive. In addition, the hospitality industry in New York is strictly regulated, and directors may innocently run afoul of complex laws. In these situations, directors and officers insurance may help ensure your doors stay open as you turn focus to the legal matter.
Get a Directors and Officers Insurance Quote in New York
Kokkoris Insurance Services provides directors and officers liability insurance for hotels across New York and other businesses across the state. Contact us to get a free directors and officers insurance quote and an evaluation of your New York insurance needs.
The Kokkoris Insurance Services team has decades of combined experience, and we provide personalized, responsive and customizable insurance options. Our goal is to help you find the right combination of coverage for your specific needs at the best possible price.
With Kokkoris Insurance Services, your insurance will also stay dynamic, so you can adjust your needs as your business grows and gains more success. Our team understands your liability risks and will work to offer you insurance bringing more coverage for less. Whether you need help with risk management, have questions about insurance or want to find ways to ensure your policy still protects you with legislative changes in your industry, contact us to get answers.
The costs of your insurance will depend on a number of factors, including your company profits and revenue, the size of your organization, industry, past claims, location and other factors. To find out how much directors and officers coverage may cost, contact us at Kokkoris Insurance Services for a free quote and consultation.
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Work With a Broker That Cares
If you are considering directors and officers liability coverage in New York, contact us at Kokkoris Insurance Services for a free quote and consultation. Our team has been offering insurance solutions to New York businesses for more than 25 years. In that time, we have developed a track record of helping companies find a personalized insurance fit.
When you look for directors and officers liability insurance through the New York offices of Kokkoris Insurance Services, our team reviews your business goals, structure, liability risks, current policies and more to bring you the right insurance coverage within your budget. We bring you multiple quotes and solutions, so you stay in the driver’s seat and find options to address your risks.
If you're ready to start supporting your business from within, focus on your leaders and management with directors and officers insurance. Contact us at Kokkoris Insurance Services to find out more. Whether you email or call, we'll provide you with free quotes relevant to your business's needs.