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D&O insurance

In today's generation businesses and organizations are growing more than ever! New businesses means more services and support, but those running the business also need some protection.

Non-profit organizations would have this insurance to ensure their officers/directors are protected, and most often they would apply for this type of insurance. 

Directors and Officers Insurance is available for those who have a business. This insurance has been used for those who have claims or if their company gets sued, but the reasoning and how they get sued matters because it will determine how much you may get. There’s different coverages that are offered to officers and directors such as side A, side B, and side C, which all means they have different purposes. As a business owner, you are responsible for researching these different coverages thoroughly and making a decision after evaluating your options. The type of D&O insurance that you invest in will depend on the values and priorities that your specific business has. As such, it is important for you to decide on the type of D&O insurance that best suits your needs.

Side A: When a company is being claimed for accidents that an officer or director has caused the company may refuse or is unable to compensate for the damage that has been done, with that information Side A may cover that. This may occur when a company is declaring bankruptcy, and if that happens it's their entity that is insured but their personal assets are at risk. For example, if a director decides to cut down security costs and simplify the security system embedded in a building, the director can be found liable to insurance claims. Even though the insurance would cover such accidents you should be diligent to avoid trouble. 

Side B: Directors and officers will most often experience financial losses when the company grants indemnification (cover the losses or harm). Side B is a policy that will reimburse the cost appropriately/fairly. In this coverage, it is the company that is insured while the corporate assets are at risk.  This is more of a financial loss coverage meaning if the company experiences loss regarding money the insurance may cover the situation.

Side C: Entity coverage is a coverage that will protect its entity, or its officers and directors. The company is then covered but it’s company assets are at risk. If one director or officer made the wrong decision and a customer or client sues the whole company the insurance will protect those who were not involved. It protects the title of the officers and directors. Ultimately this depends on the situation/case, the insurance company will not cover any Criminal offenses or anything crime related, so if the client is suing you because an officer’s negligence led to death then the insurance will most likely avoid those situations. 

To sum this up D&O insurance will cover legal fees, settlements, financial losses and situations when you are held liable. This may also apply to common allegations such as negligence, failure to comply, and reporting errors. There are a lot more aspects to consider, but you should contact your insurance advisor to have a clear understanding of what they have. The type of D&O insurance that you invest in will also depend on your budget, how much you are willing to spend and what you are trying to protect. These coverages will also differ on your company revenue and size. Typically, smaller businesses may not need this type of coverage and a larger company may consider this to be a positive asset to their business. For a developed and strong business you should consider D&O insurance!

Other insurance 

Professional liability

Professional liability is a common type of insurance that businesses apply for, because it protects you and your practice for providing services. Therapists, doctors and even estheticians will most likely have this insurance because it protects you from any accidents or negligence you may cause during a session. For example, if your therapist followed all the procedures but a device malfunction occurs, harming you and forcing you to seek emergency treatment, you can sue them. Looking at business perspectives, having a claim or a lawsuit has a negative impact on it, and if a patient sues the insurance can help you avoid those claims if the situation was an accident. Insurance will not cover any criminal offenses because insurance is also law meaning it will not cover you for any of the crimes you may have committed, especially death.

Commercial general liability

Commercial general liability can help you with accidents that happened on the property where the business is held. If you have a clinic and the accident had nothing to do with the staff such as falls, falling boxes and so on, the insurance may cover that accident. Commercial general liability is basically “you break, you pay!” so in cases like a fall and it injuring the person you have to compensate or pay for their injuries, which insurance covers that. Insurance will not cover any criminal offenses. 

Commercial Auto insurance

Commercial vehicles are very common because they’re company cars that help deliver, pick-up and even transfer goods. This insurance is made for services like taxis, warehousing, or even guide tour vehicles. In situations like those they’re made so that your personal insurance will not be affected heavily or at all. Let’s say you got into an accident with your company vehicle, whether you are at fault for hitting the other car the insurance will not affect  your personal auto insurance. 

Always do a careful and thorough check on the type of insurance that you want to invest in for your business. As a business owner, it is your duty to protect the financial stability of your business at all costs, so the best way to prevent lawsuits and claims from getting filed against you, you should invest in insurance. It is never too late to expand your knowledge about insurance.

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