Skip to content


D&O Not Just for Public Companies

Text Size: - +

Far too many business owners seem to think the need for directors and officers (D&O) liability and similar management liability insurance (MLI) is only for public companies. If you number yourself among them, a major recent survey of nearly 500 decision-makers in private companies by a leading public opinion and research firm may surprise you. A few of the findings:

  • In the past three years:
    • 44% of private companies have had at least one loss event related to D&O, errors and omissions liability, fiduciary liability, or similar liability coverages.
    • 27% of private companies have experienced a D&O claim.
    • 20% have experienced employee fraud.
    • 25% have experienced an employment practices liability (EPL) incident.
  • The majority of survey respondents believed such coverages were already included in the general liability policy, when in fact they were not.
  • A significant percentage of respondents indicated their companies are contemplating taking actions in the next year that will directly impact the need for MLI protection: increasing or decreasing their workforce; reducing or eliminating employee benefits; and mergers or acquisitions.
  • While the median employee fraud loss suffered was $140,000, respondents reported losses as high as $3 million.
  • The average cost, including legal fees and fines, of a D&O loss was almost $700,000, but individual losses were reported up to $10 million.

If you have not already discussed our MLI program with your agent, now is the time to schedule a convenient appointment. Be certain your current liability insurance offers the protection you need from these types of potential losses.

©2015 Selective Ins. Group, Inc. (Branchville, NJ). "Selective" insurers include Selective Ins. Co. of America, Selective Ins. Co. of New England, Selective Ins. Co. of N.Y., Selective Ins. Co. of South Carolina, Selective Ins. Co. of the Southeast, Selective Way Ins. Co., Selective Cas. Ins. Co, Selective Fire and Cas. Ins. Co and Selective Auto Ins. Co. of N.J. Insurers and products available vary by jurisdiction.