Frequently Asked Questions
What does D&O insurance usually cover in Florida?
D&O insurance protects directors and officers if they’re personally sued for decisions made in their official role. It covers things like:
- Alleged breaches of fiduciary duty
- Mismanagement claims
- Legal defense costs
- Settlements or judgments
This coverage shields personal assets, which is especially important in leadership roles with legal exposure.
What are common exclusions in D&O insurance policies?
Most D&O policies do not cover:
- Criminal or intentionally dishonest acts
- Personal profits gained illegally
- Claims between directors/officers at the same company
- Lawsuits brought by large shareholders or internal parties
Understanding these limits is key to avoiding surprises later.
How can Florida-based organizations customize D&O coverage?
You can tailor your policy by:
- Reviewing your board’s exposure based on your industry
- Adding endorsements for employment practices or cyber-related liability
- Aligning coverage with Florida regulations and board governance policies
- Working with an agent who understands Florida’s nonprofit and small-business liability trends
Why is indemnification such a big deal in D&O coverage?
Indemnification means the company agrees to back up its directors/officers financially. But if the business goes under or can’t pay (like during bankruptcy), D&O insurance steps in to cover defense costs, fines, and settlements. Without it, leaders could be personally liable.
What should Florida nonprofits look for in a D&O policy?
- Broad coverage for board decisions and management liability
- Legal defense for claims—even if baseless
- Affordable premiums that fit tight nonprofit budgets
- Clear exclusions and limits
- Involvement from board members in understanding the risks
Nonprofits are often sued over HR issues or misuse of funds, so D&O coverage helps protect the mission—and the people behind it.