- A-side coverage. This part covers directors, officers, and sometimes employees, for defense costs, settlement fees, or judgments if the company cannot indemnify them, such as if the company has declared bankruptcy.
- B-side coverage. This covers the company for directors’, officers’, and employees’ losses when the company does indemnify them.
- C-side coverage. Also called “entity coverage,” this financially protects the corporation in its own right. Entity coverage may reduce the limits available to protect the individual officers and directors.
- Should the policy just cover directors and officers or also the company as a whole?
- Does the policy cover innocent directors if one director or officer is found guilty of wrongdoing?
- Will the policy cover allegations of criminal misconduct up to the point of adjudication?
- What policy limits (generally provided in $1 million increments) do you need?
Source: The Hartford, “Types & Costs of D&O Coverage” https://www.thehartford.com website. Accessed July 10, 2020. https://www.thehartford.com/management-liability-insurance/d-o-liability-insurance/types-costs
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