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D&O Statistics

$400K

Avgerage Cost of
D&O Claim

1 in 4 private companies will face a D&O-related lawsuit, and the average loss exceeds $400,000.

$250K

Regulatory Investigation Cost

Regulatory actions are rising, and expensive.  Expect to spend $150K to respond, even with no wrongdoing.

26%

Private Co. that Experience D&O Claim

With a one in four chance of experiencing a claim, can you afford a $400K bill?  

20%

D&O Claims that Target Individuals

Without proper D&O coverage, personal assets are at risk.

Side A - Executive Focused Coverage

Side A is a component of a Directors & Officers (D&O) insurance policy that provides direct coverage to individual directors and officers when the company cannot or will not indemnify them.

In simple terms:

  • Side A = personal protection for executives

  • It kicks in when:

    • The company is bankrupt or legally barred from indemnifying its executives.

    • The company refuses to indemnify due to internal disputes or conflicts.

Side B - Company Reimbursement 

Reimburses the company when it indemnifies its directors and officers, which is typically a requirement.

Side B kicks in when:

  • The company advances legal costs or settlements on behalf of executives.

  • The company defends its directors or officers and needs the policy to pay it back.

 

The protection goes to the company’s balance sheet, not the individuals directly.

Side C - Company Coverage

Direct coverage to the company when named in a lawsuit.

Side C = protection for the company
Side C kicks in when:

  • The company is named in a lawsuit instead of, or alongside its directors/officers.

  • The claim is securities-related (for public companies) or a management liability claim (for private ones).

 

In private company policies, Side C usually applies broadly.  For public company policies, it’s limited to securities claims.

Tech Company D&O Structure

What is D&O

Directors & Officers (D&O) Liability Insurance protects company leaders from personal financial loss if they are sued in connection with decisions made on behalf of the business. It covers legal fees, settlements, and other costs related to allegations of mismanagement, regulatory investigations, or breach of fiduciary duty.

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Director & Officer Liability 

Protecting your people and balance sheet

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