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D&O Insurance: Directors & Officers Insurance Quotes

For your business best protection and savings, we recommend bundling GL with some other important coverages on one Business Owners Policy!


For your business best protection and savings, we recommend bundling GL with some other important coverages on one Business Owners Policy!

AND then, get even more quotes over the phone!icon

Speak with a Representative Now Call 866-929-3479

In its day-to-day operations, your business can’t only be liable but its directors and officers too. And it might need to pay hefty defense costs, provide indemnification, and incur adverse financial losses. 

Directors and officers liability insurance helps your business wrap things up without incurring losses in case its directors and officers face a claim. In this guide, know what directors and officers liability insurance is, how much it costs, the best companies, and more. 

Also read:

Directors & Officers Insurance Definition 

Also called board of directors insurance, directors and officers insurance is an insurance product that provides a shield when directors and officers face liability over wrongful acts, misconduct and managerial decisions that result in economic or financial losses to third parties. Endorsements can be introduced to the language of D&O coverage so that it also covers HR and employment practices issues.


Who is Covered?

Directors and officers liability insurance covers the directors and officers of:

  • Non-profit organizations

  • For-profit organizations

  • Privately-held firms

  • Educational institutions


Also, in terms of which particular individuals are covered, these are the most common insureds in the language of directors and officers liability insurance. 

  • Chief executive officer

  • Chief operating officer

  • Chief financial officer

  • Chief marketing officer

  • Corporate secretary

  • Chief information officer

  • Chief technology officer


Why is Board Of Directors Insurance Important?

Professional liability insurance, though providing coverage for the wrongful acts committed by the employees, doesn’t cover executives. This means that professional liability insurance can’t help if directors and officers face responsibility for a claim. 

Directors and officers liability insurance is important because it allows your company to shield its directors and officers against claims. With this insurance, your company can cover indemnification and cover the costs of lawsuits on behalf of its directors and officers. 

Also, note that your business might be pulled into the mess that its directors and officers made. Board of directors insurance is important because it sees to it that your business can protect its assets. 


Common Terms Used In The Language Of Directors And Officers Liability Insurance


Insured Person

Insured person pertains to the individual(s) who are covered by directors and officers liability insurance and receives the benefits provided by the policy. Another term for insured person is name insured. 


Defense Expenses 

Defense expenses pertain to the costs a named insured needs to pay in case of a claim using the funds provided by directors and officers liability insurance. This can be further categorized as event study expenses and nominal defendant expenses.


Policy Period

Also called policy duration, policy period pertains to the length of time directors and officers liability insurance provides coverage and can be used by the insured person in the event that a claim is filed. 


Claim 

Claim is the action brought forth by a third party against the insured person named in the language of directors and officers liability insurance. Note that the term can also pertain to one’s request to get the coverage of his or her directors and officers policy. 


Wrongful Act

Wrongful act pertains to any action that results in economic or financial losses committed by the insured against a third party, which triggers the coverage of director and officers liability insurance. 


Loss

In the language of directors and officers liability insurance, loss pertains to economic or financial setbacks the insured person sustains or causes to another due to the commitment of a wrongful act. 


Extended Reporting Period 

An extended reporting period is an endorsement which extends the coverage of directors and officers liability insurance past its expiration date. 


Exclusion 

Exclusions are costs, perils, and other things not covered by directors and officers liability insurance. 


How is Directors And Officers Liability Insurance Underwritten?

Directors and officers insurance is underwritten as a claims-made policy. It only provides coverage when you file a claim after a covered peril happens and while the policy’s terms are active. 

The coverage provided by directors and officers liability insurance is divided into side A, side B, and side C. 

The side A coverage of directors and officers liability insurance allows the named insureds to indemnify the losses of the claimant if the organization where they’re working for can’t provide coverage or can do so but is prevented by a liquidation court. Side A coverage also pays for the defense costs the directors and officers must take care of. 

Directors and officers side B coverage reimburses the company when it covers the indemnification that its directors and officers are liable to pay for. 

The side C coverage of directors and officers liability insurance protects the company if it’s liable for the actions of directors and officers as an entity.


When Does Coverage Kick In?

Directors and officers liability insurance kicks in when third parties or employees file a claim. The following are the common charges or allegations the policy can take care of:


Directors and officers liability insurance provides protection in case directors and officers commit a wrongful conduct that violate the rights of employees:

  • Defamation

  • Harassment

  • Wrongful Dismissal

  • Constructive Termination

  • Discrimination

  • Failure to comply with workplace laws

  • Lack of corporate governance


You can use directors and officers liability insurance to cover the claims filed by shareholders because the executives of your business committed the following:

  • Misrepresentation of company assets

  • Misuse of company funds

  • Misleading disclosure of financial reports

  • Breach of director's duties

  • Negligent management

 

External Source (Third Party)

This usually arises when a company files for bankruptcy. Claimants will try to run after the directors and officers in an attempt to recover debts and investments on the grounds that they have not acted upon their best capacity as officials.

 

  • Customer Or Consumer Group-Related Issues

-Fraudulent or dishonest acts

-Breach of contract

-Breach of fair trading Laws

  • Creditor-Related Concerns

-Breach of fiduciary responsibility ensuing in financial -losses or bankruptcy

-Insolvent trading

  • Competitor Claims

-Theft of intellectual property

-Pilfering of competitor's customers

-Trade secrets misappropriation


Claims from Government Authorities Such As Local Government, Tax Authorities, Etc.

Organizations are separate legal entities. They are covered with laws and may unknowingly breach regulations that govern them, such as corporate law, environmental law, securities law for publicly listed companies, taxation law, and occupational health & safety. Furthermore, corporate governance evolves as the company grows, which increases exposure to claims.

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Required D&O Limits

The required D&O coverage limits of businesses vary and depend on the following factors:

  • Financial Background

  • Industry

  • Revenue

  • Shareholders

  • Requirements

  • Others


There is no rule of thumb since appropriate limits will differ depending on the combination of factors we've outlined above. Below is an illustration of how possible D&O limits could be planned, as explained by FounderShield.


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Directors And Officers Liability Insurance Cost

The average directors and officers liability insurance cost is $113 per month or $1,356 per year for a $1 million coverage. Factors that affect D&O insurance rates are:

  • Number of directors and officers in your company

  • You company’s valuation

  • Expected losses

  • Expected worth of liabilities

  • Years in business

  • Claims history


In addition, here’s a table showing the best companies that offer directors and officers liability insurance with their respective d&o insurance cost. 


Cost per MonthCost per YearBest for
CoverWallet$103.91$1,246.92Directors and officers liability insurance quotes comparison online
Tivly$105$1,260Comparing directors and officers liability insurance quotes over the phone
Thimble$105$1,260Directors and officers liability insurance for growing startups
Hiscox$110$1,320Directors and officers insurance with fast claims process


How To Compare Directors And Officers Insurance Quotes?

Each organization is uniquely designed. Each has different needs and funding requirements, so when getting a directors and officers insurance policy, always consider the cost, coverage, and insurance company abilities and dependability.

Understandably, directors and officers insurance cost always matter. However, any savings made from reduced premiums may affect the coverage and defeat its purpose of protection. Thus it is not advisable if only the premium is considered.

Furthermore, it is a must that the directors and officers insurance companies tapped can keep their promise stipulated in the acquired D&O policy.

They must have professionals who understand the nuances of business and can give a D&O coverage quote that will satisfy various kinds of business owners' needs.

Here are some questions to ask when you compare directors and officers quotes, before selecting a directors and officers insurance company:

  • Knowledge: How much do they know about d&o insurance? How well do they understand the business and its industry? An advisor who has a meager understanding of your business will likely not carry the correct insurance, leaving you with inadequate coverage.

  • Reviews and feedback: Who are their former and current clients? How was their experience with them?

  • Cost and budget: How much coverage do you and your company need, and how much can you afford?

  • Coverage: What are the specific risks in your industry? Will their products guard the entire company against lawsuit fees?

  • Added considerations: Are there any particular deliberations when selecting a policy?


Hence, compare D&O insurance quotes online through this page and choose the best companies that have the right product and coverage for your business. Click the “Get Quotes” button to start. 

COMPARE CHEAP D&O INSURANCE QUOTES

Get all the best quotes from leading providers in a click of a button!

AND then, get even more quotes over the phone!icon

Speak with a Representative Now Call 866-929-3479

Best D&O Insurance Companies

Many companies offer D&O liability insurance. However, we’ve narrowed the choices to the carriers listed here. That said, read some of the reviews to know their pros, cons, and rate for a $1 million D&O liability insurance coverage.


CoverWallet Directors And Officers Liability Insurance

Pros

  • Cancel your directors and officers liability insurance anytime

  • Compare directors and officers liability insurance quotes online

  • Sells directors and officers liability insurance to a wide range of businesses

Cons

  • Directors and officers liability insurance is underwritten by partners

CoverWallet sells directors and officers liability insurance for established businesses in the sectors of management consulting, transportation, food, hospitality, and more. Note that your directors and officers liability insurance from this company is underwritten by several partners.

Before getting covered, CoverWallet requests you to use its online quotes comparison platform to see the rates and buy the quotes of its partners. Directors and officers insurance from CoverWallet offers a $1 million-$2 million minimum per occurrence limit.

Best for: Directors and officers liability insurance quotes comparison online

Average cost: $103.91 per month

Our rating: 10/10


Tivly Directors And Officers Liability Insurance

Pros

  • Compare directors and officers insurance quotes over the phone

  • Call a representative and get covered fast

  • Responsive customer service

  • Directors and officers liability insurance is available at Thimble

Cons

  • Doesn’t issue online quotes

Tivly (formerly CommercialInsurance.NET) underwrites directors and officers liability insurance, and sells it in partnership with Thimble. This company’s D&O insurance has a $1 million minimum per occurrence limit. You can request to get more coverage.

Note that Tivly doesn’t issue online quotes. You have to apply for a quote online and wait for an agent to call.

You can also contact the company yourself for fast coverage. That said, Call Tivly now and compare directors and officers liability insurance quotes over the phone.

Best for: Directors and officers liability insurance for growing startups

Average cost: $105 per month

Our rating: 10/10


Thimble Directors And Officers Liability Insurance

Pros

  • ACORD 25 certificate of insurance

  • Same day coverage

  • Offers directors and officers liability insurance for startup businesses with impressive valuations

Cons

  • You can’t contact customer service by calling

Thimble doesn’t underwrite directors and officers liability insurance. However, it sells one underwritten by Tivly. To get covered, visit Thimble’s website then it will take you to Tivly's representatives.

Best for: Directors and officers liability insurance for growing startups

Average cost: $105 per month

Our rating: 9/10


Hiscox Directors And Officers Liability Insurance

Pros

  • Efficient claims handling

  • File and track a claim online

  • 14-day money-back guarantee

Cons

  • Directors and officers liability insurance is underwritten by a partner

Hiscox sells directors and officers liability insurance that CyberPolicy underwrites. To get a quote, you need to visit Hiscox’s page. You will then be redirected to CyberPolicy’s site where you can get an estimate of your rates. If CyberPolicy can’t issue an online quote, it will assign a representative who will discuss the particulars of your D&O policy.

Best for: Directors and officers insurance with fast claims process

Average cost: $110 per month

Our rating: 9/10


Other Insurance Products To Consider Aside from Directors And Officers Liability Insurance

Directors and officers liability insurance isn’t the only protection you need. Consider getting these other business insurance policies.


General Liability Insurance

General liability insurance provides protection if your company is liable for the injuries or damaged property of a third party.

Particularly, this insurance will pay the settlements or legal defense costs such as attorney fees, court fees, investigation fees, and others.

Similar to directors and officers liability insurance, general liability insurance is multi-faceted. And aside from bodily injury or property damage claims, it will also help if your company is sued for advertising injury, products and completed operations, or liability to rented premises.


Professional Liability Insurance

If directors and officers liability insurance protects the leaders of your company, professional liability insurance covers regular employees.

The coverage of professional liability insurance kicks in when the employees of your business or your business itself is liable for:

  • Negligence

  • Misrepresentation

  • False advice

  • Breach of contract

  • Breach of confidentiality

Similar to directors and officers liability insurance, professional liability insurance is also written as a claims-made policy. But note that some insurance companies offer this as an occurrence policy.


Workers Compensation Insurance

Workers compensation insurance covers your company’s regular employees. However, you can modify the policy and have directors and officers as named insureds on its terms. With workers compensation insurance, you can cover the following costs when the directors and officers of your company sustain a work-related injury or disease:

  • Hospitalization

  • Retraining

  • Medication

  • Rehabilitation

  • Death benefits

  • Lost wages


Employer’s Liability Insurance

Directors and officers liability insurance might not cover negligence claims filed by an employee who sustained a work-related injury or disease. Because of this, insurance companies offer employer’s liability insurance.

If an employee of your business becomes sick or injured then files a claim, employee liability insurance will cover settlements or defense costs such as attorney fees, investigation fees, court fees, etc.


Employment Practices Liability Insurance

Directors and officers liability insurance covers employment related claims. However, it only does so in a very limited manner. And so, consider getting employment practices liability insurance. Employment practices liability insurance provides comprehensive coverage in case an employee files a claim against your business due to:

  • Missed employment benefits

  • Wrongful termination

  • Discrimination

  • Sexual harassment

  • Missed employment benefits

  • Exploitation


References

- https://en.wikipedia.org/wiki/Directors_and_officers_liability_insurance

- https://www.iii.org/article/directors-and-officers-insurance


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