Insurance Library

Small Business > Directors and Officers Insurance

Traditional Directors and Officers (D&O) liability insurance has been targeted to large companies with financial and securities-related claims. It has not always been relevant for smaller companies. It covers financial liability claims against a company's officers and directors, including the CEO, CFO, VPs and directors.

There is now a new type of D&O insurance appropriate for smaller and mid-sized businesses. It's called employment practices liability insurance (ELPI) and it expands traditional D&O insurance to cover situations like sexual harassment claims and wrongful termination.

D&O insurance is most useful for professional firms; accountants, lawyers, and consultants all fall into this category. Any decisions made regarding the investment of money are potential stockholder lawsuits, and any company with a board of directors should have it.