Being the head of a company can be a trying position, especially when legal action is taken against them. If you were to find yourself in this difficult situation, having insurance can be a lifesaver. Directors and officers for public companies should consider protecting themselves from defense costs with liability insurance. The average cost for a shareholder lawsuit settlement has risen to over $30 million dollars, and if you’re not properly protected, you could face being held accountable for part of that payment.
With insurance for directors and officers, you’re protecting yourself from any legal action brought against you for an error in judgment, breech of duty or wrongful act while representing your organization. Shareholder lawsuits can often cost thousands and possibly millions of dollars for your organization, which may not only reflect poorly on you, it could end up hitting you with out-of-pocket expenses. Choosing to protect yourself from an unforeseeable circumstance can be as simple as choosing a reliable and trustworthy company to provide you with liability insurance. Not only can the insurance protect you from SEC auditing, it can provide privacy and defense services and financial advisory services.
Choosing to protect your title and financial security is something all directors and officers for public companies should consider. When answering to the amount of shareholders a public company does each and every day, protecting yourself and your future is a necessary expense.