Why Startups Need Directors and Officers Liability Coverage
Currently, the U.S. ranks first in the number of startup businesses worldwide at roughly 71,826. In comparison, the second largest country is India at around 13,454. According to Forbes, although these businesses are small, their importance to the U.S. economy is enormous. Before the pandemic, small businesses with less than 500 employees accounted for two-thirds of new American jobs and generated 44% of our country’s gross domestic product.
Startups face many challenges, including sourcing adequate funding, attracting new investors, navigating complex business regulatory requirements, managing day-to-day operations and maintaining a workforce. With the mounting pressure on entrepreneurs to juggle all facets of launching a successful business, management liability insurance can often be overlooked as an important part of their risk management strategy.
Directors and officers coverage protects businesses, board members and officers from lawsuits that could arise from their decisions. Proper insurance also helps to attract talented executives as it offers a layer of protection for the personal assets of these important decision-makers.
Devon Park Specialty’s Management Liability product was designed to address these exposures with important product features such as:
- Lifetime Occurrence Reporting Provision for former directors and officers
- $1 million additional Side A coverage automatically provided to protect the personal assets of individual directors and officers in the event the company is unable to provide indemnification
- Regulatory and antitrust coverage
In addition, our Business Resource Center provides access to cost-saving services such as:
- Pre-employment screenings including discounted background checks
- Discounted payroll processing and tax services
- Suggested free and paid services for social media platforms, development and management
- A free human resources consultation hotline
Devon Park is a market for startup businesses with the following preferred characteristics and submission materials:
- Manufacturing and technology companies
- Companies that have received initial startup capital
- Startups with a comprehensive business plan
- Financials, which could include actual or projected statements
- Capitalization table
Let us help you provide a competitive quote option to your clients and give them peace of mind by sending your submissions to [email protected].
As always, thank you for your support and business.
Contact and Written by Kenny Bang
Second Vice President, Team Leader | 888-523-5545, ext. 2923
June 2, 2022