Tips for Executives To Maximize D&O Coverage


With federal and state regulators ramping up enforcement efforts, corporate executives and boards of directors are facing more potential sources of liability than ever before, such as claims that they misled investors about securities offerings or misstated a company's financial condition.  Here, Law360 offers tips to get the most out of directors and officers coverage.

Control the Defense

Corporate policyholders can take steps when applying for a D&O policy to ensure that they have maximum control over the defense of future claims.

If a corporation buying D&O coverage has a preferred firm that it generally uses as defense counsel, it can obtain the insurer's approval of that firm during the application process, said Anderson Kill PC shareholder Bill Passannante. Getting preapproval for a particular firm can help a company avoid disputes with a carrier over choice of counsel down the road, according to attorneys.
"If Company X knows it wants to use particular defense counsel, getting approval of the firm and rates is easier to do up front," Passannante said.