Know About Directors and Officers Liability Insurance

Directors and officers liability insurance is one type of insurance. This policy provides the protection to the directors and officers of large companies from legal judgments and costs that arise from unlawful acts, wrong investment decisions, failure to maintain the property and errors and negligence, etc. These things may happen while they are performing their responsibilities.

Generally this insurance policy is needed by the company directors and officers who are responsible to investors, creditors, employees, shareholders and customers and etc. You can find three types of coverage in this insurance policy such as Coverage A, B and C.

• Coverage A: This type of coverage is a personal or employee coverage that covers the past, present and future directors and officers. It helps them to protect themselves against claims raised from a wrongful act and personal liabilities that they face in their job.
• Coverage B: This type of coverage is the corporate coverage for the company to the extent which permits the company to protect the directors and officers from claims. Compensation is received by the company at the time of claim.
• Coverage C: Company is insured against the security claims in this entity coverage. Protection is provided by this coverage to the company for it's own liabilities.
• Exclusions: The coverage for fraud or other criminal acts are excluded by the directors and officers policies. Claims that arise out of prior acts, punitive damages, bodily injury and property damage are excluded by this policy.

However, this insurance policy coverage and exclusions depend upon the insurance company and particular state.