Directors and Officers Insurance in Florida

Business Insurance for Directors and Officers

Directors and Officers Insurance protects your company's leadership from personal financial loss when they are sued for alleged wrongful acts in managing the company. D&O insurance covers legal defense costs, settlements, and judgments arising from claims against directors, officers, and often other managers. This protection is essential because standard business liability insurance doesn't cover management decisions, and personal assets of executives can be at risk when they're sued in their leadership capacity.

Why Your Business Needs This

• Directors and officers can be held personally liable for business decisions even when acting in good faith
• Shareholder lawsuits, regulatory investigations, and employment claims frequently target company leadership
• Legal defense costs alone can be financially devastating without insurance protection
• Quality candidates may refuse board or executive positions without D&O coverage in place
• Florida businesses of all sizes face increasing litigation against their leadership teams

What It Covers

D&O insurance provides coverage across three primary areas. Side A coverage protects individual directors and officers when the company cannot indemnify them. Side B coverage reimburses the company when it indemnifies directors and officers for covered claims. Side C coverage, also called entity coverage, protects the company itself in certain securities claims. The policy covers legal defense costs, settlements, judgments, and related expenses. Common claims include allegations of breach of fiduciary duty, mismanagement, employment practices violations, regulatory investigations, and shareholder disputes.

Who Should Be Protected?

D&O coverage should protect all current and former directors, officers, and often extends to committee members and senior managers. Many policies include coverage for employee benefits plan administrators. The definition of insured persons varies by policy but typically includes anyone in a management or supervisory role with significant decision-making authority. At The Gordon Agency, our experienced agents ensure your policy definitions adequately cover all appropriate individuals in your organization.

What Are Common Exclusions?

D&O policies exclude intentional fraudulent acts, personal profit obtained illegally, and bodily injury or property damage claims covered under other policies. Criminal acts, prior known claims, and insured versus insured claims are typically excluded. The policy won't cover fines, penalties, or matters deemed uninsurable under law. Exclusions can be complex and vary significantly between carriers, making it essential to work with experienced agents who understand the nuances of D&O coverage.

Do Nonprofits Need D&O Insurance?

Nonprofit organizations absolutely need D&O insurance, often more urgently than for-profit companies. Nonprofit directors and officers face similar liability exposures including employment claims, regulatory issues, and allegations of financial mismanagement. Board members of Florida nonprofits are frequently volunteers who won't serve without liability protection. Nonprofits can face claims from donors, members, beneficiaries, and regulatory agencies. Without D&O coverage, volunteer board members risk their personal assets and quality candidates may refuse to serve.

How Much Coverage Do You Need?

Coverage amounts depend on your company size, industry, governance structure, and risk profile. Factors include annual revenue, number of employees, whether you're publicly traded or privately held, and your regulatory environment. The Gordon Agency reviews your complete business situation to recommend appropriate limits. Many growing companies start with lower limits and increase coverage as they expand. Working with our experienced insurance agents ensures you have adequate protection at a price within your budget.