The coverage provided by most Vista commercial insurance policies tends to be specialized instead of broad, and it’s important to remember there is only so much directors & officers (D&O) policies can cover. Here are 2 common exclusions and 2 situations that are commonly covered by the terms and conditions of D&O insurance.
1. Claims Covered by Other Policies (Not Covered)
Vista directors & officers insurance policies usually complement general liability business policies. For example, if a agency president accidentally breaks a window at her office, this would qualify as property damage that should be handled as a general liability loss instead of a D&O situation.
2. Deception and Misconduct (Not Covered)
Errors and mistakes are unfortunate aspects of human nature. D&O policies offer various levels of coverage that acknowledge the possibility of business blunders made by agency principals. Nonetheless, the actions of executives who skirt the laws and regulations of their industries for ulterior motives cannot be included in the policy coverage. Losses caused by fraudulent acts or willful misconduct are not covered by D&O insurance.
3. Wrongful Termination (Covered)
Disgruntled employees who believe their terminations were caused by the actions of a agency executive are likely to file a lawsuit directly against the agency principal, or they may also allege discrimination. D&O policies offer coverage against claims arising from certain employment practices, including hiring and firing.
4. Shareholder Lawsuits (Covered)
Directors and officers of publicly traded agencies, whether they are listed on Wall Street or on the OTC boards, are being increasingly targeted by unhappy shareholders who are filing lawsuits. D&O insurance provides coverage when shareholders believe they have legal recourse against what they perceive to be inadequate corporate governance.
If you’d like to learn more about D&O insurance, get in touch with the insurance experts at American Tri-Star in Vista, CA. In addition to our reliable business insurance, we also offer affordable options for health, home, and car insurance in Vista. Call 760-758-1600 today to speak with one of our friendly representatives and receive a free quote.