Delaware Business Insurance Update from CNC Insurance Associates, " Directors & Officers" Targets for Litigation" 10-22-15

Recently, the board of directors for Volkswagon were served with a lawsuit from shareholders over the now well documented emmissions fraud. This will be a high profile case and will certainly expose the risks that directors and officers of companies have. Even in small business the claims against board members is increasing. General liability policies do cover the directors of companies in their capacity of business  but only for property damage and bodily injury. However the general liability policy has no coverage for the directors when they are sued personally for thier oversight or fiscal decisions. This is where the D&O insurance policy comes into play. These policies are written to specifically cover suits against directors and officers for thier personal liability in running companies.  Laws in most states allow directors to be sued, and is the reason for having these policies in place if you have a business that is controlled by a board. Talk to your insurance professional about the D&O insurance policy. By all means buy the coverage if you have a board of directors. This is the only way to fund the risk of defending the board and pay judgements. Until next time be careful out there and know your risks.

G. Kevin Nemith President of CNC Insurance Assoc. and Small Business Insurance Center
Serving DE, MD, PA, NJ, & VA
www.cncinsurance.com
www.bizinsurancetv.org

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