Directors and Officers (D&O) insurance is important for technology companies to protect against shareholder lawsuits. While many tech executives understand the need for D&O coverage at a high level, they may not know when to reevaluate the policy. The document provides guidance on common times to reassess D&O coverage, such as when making operational changes, implementing new strategies, or experiencing business shifts. Technology companies should work with their broker to regularly review D&O limits and terms as the business evolves to ensure ongoing protection from potential stakeholder claims.
D&O Insurance - Become a Knowledgeable BuyerCraig Tappel
When serving as a board member for a corporation or non-profit, question the Management Liability policy limits and the coverage. They must be sufficient to protect both the entity and your personal assets.
This paper is provided by NAPLIA.
The Investment Advisor’s Guide to Errors & Omissions Insurance will help you anticipate areas of underwriter concern as it relates to your specific investment practice, helping you internally evaluate your risk exposures and better define your activities and professional services.
Unlocking the Performance Levers of Commercial UnderwritingCognizant
As insurance underwriters are called upon to do more, automation and lean processes -- such as decision support analystics -- are the keys to boosting effectiveness and efficiency.
Trade Credit Insurance White Paper December 2008jlebendig
Get our most recent white paper...An Overview of Trade Credit Insurance here. Great reading, insightful and it will answer more of your questions. Don\'t have credit insurance yet? What are you waiting for? Contact me to discuss your options for protecting your company.
Kill Inefficiencies, Find Hidden Value: An Independent Review Can Reveal Unta...Polsinelli PC
Too often the service provider agreements for your company’s benefit plans are negotiated, executed, and promptly stowed away. When was the last time your contractual arrangements saw the light of day and were reviewed by plan fiduciaries to determine whether they continue to be reasonable?
Join Andrew Douglass from Polsinelli’s Employee Benefits & Executive Compensation practice and Eric Krieg from Risk International Benefits Advisors as they discuss the rewards of an independent examination of your service provider agreements, and how it can provide behind-the-scenes knowledge that will aid future decisions for your company’s employee benefit plans.
Reviews can be done at the time of your annual renewals or conducted periodically through ongoing fiduciary monitoring, and can expose inefficiencies and highlight opportunities to negotiate more favorable commercial terms. Andrew and Eric will lay out a roadmap for companies interested in taking the first step toward an independent review of their ERISA service provider agreements, and cover the following additional topics:
-Opportunities created by independent reviews
-Recommended frequency of reviews and best practices for compliance with ERISA’s fiduciary duties
-Strategies for identifying cost savings and other value opportunities
-Negotiating more favorable contract provisions
-Monitoring performance of your service providers through ongoing independent reviews
D&O Insurance - Become a Knowledgeable BuyerCraig Tappel
When serving as a board member for a corporation or non-profit, question the Management Liability policy limits and the coverage. They must be sufficient to protect both the entity and your personal assets.
This paper is provided by NAPLIA.
The Investment Advisor’s Guide to Errors & Omissions Insurance will help you anticipate areas of underwriter concern as it relates to your specific investment practice, helping you internally evaluate your risk exposures and better define your activities and professional services.
Unlocking the Performance Levers of Commercial UnderwritingCognizant
As insurance underwriters are called upon to do more, automation and lean processes -- such as decision support analystics -- are the keys to boosting effectiveness and efficiency.
Trade Credit Insurance White Paper December 2008jlebendig
Get our most recent white paper...An Overview of Trade Credit Insurance here. Great reading, insightful and it will answer more of your questions. Don\'t have credit insurance yet? What are you waiting for? Contact me to discuss your options for protecting your company.
Kill Inefficiencies, Find Hidden Value: An Independent Review Can Reveal Unta...Polsinelli PC
Too often the service provider agreements for your company’s benefit plans are negotiated, executed, and promptly stowed away. When was the last time your contractual arrangements saw the light of day and were reviewed by plan fiduciaries to determine whether they continue to be reasonable?
Join Andrew Douglass from Polsinelli’s Employee Benefits & Executive Compensation practice and Eric Krieg from Risk International Benefits Advisors as they discuss the rewards of an independent examination of your service provider agreements, and how it can provide behind-the-scenes knowledge that will aid future decisions for your company’s employee benefit plans.
Reviews can be done at the time of your annual renewals or conducted periodically through ongoing fiduciary monitoring, and can expose inefficiencies and highlight opportunities to negotiate more favorable commercial terms. Andrew and Eric will lay out a roadmap for companies interested in taking the first step toward an independent review of their ERISA service provider agreements, and cover the following additional topics:
-Opportunities created by independent reviews
-Recommended frequency of reviews and best practices for compliance with ERISA’s fiduciary duties
-Strategies for identifying cost savings and other value opportunities
-Negotiating more favorable contract provisions
-Monitoring performance of your service providers through ongoing independent reviews
The most precious asset of any business is its executive team. Part of the struggle that closely held (and public) companies face is their ability to attract and retain key employees. An executive bonus plan may be an effective strategy to hire away from your competition and keep your top people with your firm.
Investment Advisors & Financial Professionals | Use Your Insurance as a Marke...The 401k Study Group ®
Presented by North American Professional Liability Insurance Agency, LLC (NAPLIA). The White Paper discusses how proactively using your insurance coverage as a marketing tool will help you.
Avoiding a “suitability gap” between Financial Advisers and Discretionary Inv...corfinancial
Suitability is a key tenet that has in large part reshaped how retail financial services and products are distributed in the post-RDR world. Client best interests are now the paramount consideration when determining which financial products and services are appropriate. Financial Services firms must be able to demonstrate that their business models, products and services meet this standard. Suitability and appropriateness are obligations that Financial Advisory firms and Discretionary Investment/Fund Managers must work out between themselves.
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Precise business and operating model definitions can help insurers spin off ventures that stay ahead of customer needs and market requirements. Here are some lessons we’ve acquired by helping our clients establish winning ventures.
Controlling Workers’ Compensation Costs by as Much as 20% - 50%Richard Swartzbaugh
What is Workers’ Compensation?
Who Benefits from Workers’ Compensation Cost Control? Everyone!!!
Worker’s Comp costs can be one of your Company’s greatest “out of control” costs, or, YOU can but in a proven 19-step system to reduce Workers’ Comp costs by as much as 20% - 50%, and utilize critical metrics to address:
- Why workers’ compensation metrics are important
- The formulas for how to calculate 5 critical metrics
- How to leverage these metrics to make an impact at your organization
Following the step-by-step instructions in 19-Step system for the calculation and application of critical metrics will address:
- Workers’ comp viewed as a cost of doing business
- Getting management to understand value of return to work
- Convincing policy holders to embrace a worker recovery program
- Lack of informed and effective employer involvement in WC claims issues
- Stakeholder apathy
- Managers and supervisors not taking seriously their duty to protect workers
Avoiding Workers’ Comp mistakes & loopholes will help drive three major points:
- Drivers of human behavior
- Disincentives to “Return to Work”
- Most common employer mistakes
Finally:
- Evidence-based medicine will create better Workers’ Comp claim outcomes.
- In organized environments, executing successful return to work programs with Unions (and members) is essential.
- As part of a comprehensive workers compensation program, employers should maintain close communications with injured employees to ensure they recover quickly, do not drop out of the workforce and return to work rapidly. Get Well Cards are part of a positive, proactive communication strategy.
November 2017 Reprint - Actively Manage Your Risk with a Captive Insurance Co...CBIZ, Inc.
Captive insurance companies are increasingly being considered as part of insurance and risk management practices. They hold benefits for companies across a range of industries, and may be of particular interest to the Commercial Real Estate sector.
4 Areas of Operations to Review for Financial OverspendCBIZ, Inc.
Few things can make you more of a hero in your organization than uncovering hidden sources of cash. Accessing savings doesn’t have to mean draconian measures. By taking a comprehensive and creative approach to potential sources of refunds, credits and reductions, you may be able to generate cash that can help your organization prepare for what comes next. Discover four places cash could be hiding in this article.
The most precious asset of any business is its executive team. Part of the struggle that closely held (and public) companies face is their ability to attract and retain key employees. An executive bonus plan may be an effective strategy to hire away from your competition and keep your top people with your firm.
Investment Advisors & Financial Professionals | Use Your Insurance as a Marke...The 401k Study Group ®
Presented by North American Professional Liability Insurance Agency, LLC (NAPLIA). The White Paper discusses how proactively using your insurance coverage as a marketing tool will help you.
Avoiding a “suitability gap” between Financial Advisers and Discretionary Inv...corfinancial
Suitability is a key tenet that has in large part reshaped how retail financial services and products are distributed in the post-RDR world. Client best interests are now the paramount consideration when determining which financial products and services are appropriate. Financial Services firms must be able to demonstrate that their business models, products and services meet this standard. Suitability and appropriateness are obligations that Financial Advisory firms and Discretionary Investment/Fund Managers must work out between themselves.
Setting Up a Successful Insurance VentureCognizant
Precise business and operating model definitions can help insurers spin off ventures that stay ahead of customer needs and market requirements. Here are some lessons we’ve acquired by helping our clients establish winning ventures.
Controlling Workers’ Compensation Costs by as Much as 20% - 50%Richard Swartzbaugh
What is Workers’ Compensation?
Who Benefits from Workers’ Compensation Cost Control? Everyone!!!
Worker’s Comp costs can be one of your Company’s greatest “out of control” costs, or, YOU can but in a proven 19-step system to reduce Workers’ Comp costs by as much as 20% - 50%, and utilize critical metrics to address:
- Why workers’ compensation metrics are important
- The formulas for how to calculate 5 critical metrics
- How to leverage these metrics to make an impact at your organization
Following the step-by-step instructions in 19-Step system for the calculation and application of critical metrics will address:
- Workers’ comp viewed as a cost of doing business
- Getting management to understand value of return to work
- Convincing policy holders to embrace a worker recovery program
- Lack of informed and effective employer involvement in WC claims issues
- Stakeholder apathy
- Managers and supervisors not taking seriously their duty to protect workers
Avoiding Workers’ Comp mistakes & loopholes will help drive three major points:
- Drivers of human behavior
- Disincentives to “Return to Work”
- Most common employer mistakes
Finally:
- Evidence-based medicine will create better Workers’ Comp claim outcomes.
- In organized environments, executing successful return to work programs with Unions (and members) is essential.
- As part of a comprehensive workers compensation program, employers should maintain close communications with injured employees to ensure they recover quickly, do not drop out of the workforce and return to work rapidly. Get Well Cards are part of a positive, proactive communication strategy.
November 2017 Reprint - Actively Manage Your Risk with a Captive Insurance Co...CBIZ, Inc.
Captive insurance companies are increasingly being considered as part of insurance and risk management practices. They hold benefits for companies across a range of industries, and may be of particular interest to the Commercial Real Estate sector.
4 Areas of Operations to Review for Financial OverspendCBIZ, Inc.
Few things can make you more of a hero in your organization than uncovering hidden sources of cash. Accessing savings doesn’t have to mean draconian measures. By taking a comprehensive and creative approach to potential sources of refunds, credits and reductions, you may be able to generate cash that can help your organization prepare for what comes next. Discover four places cash could be hiding in this article.
How should I prepare an ATE application? MLM 4Demi Edmunds
Matthew Williams answers the following question: After discussing funding/insurance options on a new commercial claim, the client wishes to apply for after the event legal expenses insurance (ATE). How should I prepare the application? What cover should the client seek?
Business Risks discussed: #1 Claim/Problem, Telecommuting, Signage, Age of Connectivity, OSHA Visit, IT Firm Insurance, Power Failure: Spoilage, Business Auto Policies
If your business has a corporate board or advisory
committee, you should consider protecting your assets with
D & O insurance. Many people think that only publicly traded
companies require D & O Insurance. In fact, public, private,
and even non-profit organization can face D & O litigation
risks.
As a business owner or operator, your work is about taking a series of risks over time – those you choose, and those that choose you. Your response to these business risks, or the decisions you make over time, will be closely examined by your shareholders, regulators, employees, business partners and customers. While you can’t totally avoid them, having the right coverage in place for each risk can protect you and your business from serious consequences.
Turn Your Business Risks into Growth. There’s no doubt that you could face these risks and more over the life of your business. But, if you’re prepared for them – with the right coverages – they can lead to growth instead. You’ll likely consider expanding your workforce at some point, or adding a new product line or vendor. Maybe you’ll face the loss of a key executive or major customer. You’re sure to experience increased regulatory oversight and maybe even acquire a new entity. For more on the coverages you’ll need to take these business risks and more,
Risk & Advisory Services: Quarterly Risk Advisor March 2017CBIZ, Inc.
This issue includes the following articles: 1) Top Risks Facing Businesses in 2017 2) 5 Methods Contractors Might Use to Overbill Insurance Costs 3) New York proposes Cybersecurity Regulations for Financial Services Companies
A Comprehensive Guide For Employer Liability Insurance.pptxCore Medical Center
Employer Liability Insurance (ELI) provides crucial protection for businesses against lawsuits related to employment issues like discrimination, harassment, wrongful termination, and more. It covers legal expenses and settlement costs incurred during these claims, offering financial security and peace of mind to employers. ELI ensures compliance with legal requirements and safeguards a positive work environment. While it doesn't cover intentional wrongful acts, bodily injuries, or certain penalties, it remains a vital component of risk management. Understanding state and federal regulations, minimum coverage requirements and the claims process is essential. For comprehensive guidance on ELI and Occupational Hazard Insurance, consult Core Medical Center in the USA.
For More Information Please Visit Our Site:https://www.coreworkerscomp.com/
#EmployerLiabilityInsurance
#OccupationalHazardInsurance
#EmployeeAssistanceProgram(EAP)
#CoreMedicalCenter
#USA
Navigating Risk In Data & Technology TransactionsMMMTechLaw
Presentation: Negotiating risk management terms for data & technology contracts.
The information herein is presented for educational and informational purposes and is not intended to constitute legal advice. Additional information is at www.mmmtechlaw.com/privacy-policy-and-disclaimer/ .
1. D&O. I know I need it…..but when do I need to evaluate it.
Directors and Officers (D&O) coverage is one of the most important insurance policies
any emerging technology company could have. Most of these companies purchase this
coverage because the company executives understand the value of it, or the company is
being required by institutional investors. Either way, having Directors and Officers
Liability Coverage will always be a benefit to a company’s risk management portfolio.
One of the most common responses from Technology executives is “I have the coverage.
I understand D&O insurance at a high level, but not enough to know when we should
evaluate if the coverage is adequate.” Technology executives are aware of need for
D&O, but it is difficult to know when the current program should be reassessed. As there
is nothing spelled out about when the right time would be to revisit the coverage terms
and condition, below are a few instances when a company should reassess:
1. When your organization is making an operational change;
2. implementing a new strategy; or
3. seeing a turn in your business.
But you are probably saying to yourself, “These situations are riddled with a thousand
other items that are needed for a successful outcome.” You are right, but adding an
evaluation of the D&O coverage to your checklist is imperative because it can save you
future heartache and grey hairs.
If we were to take a look at the typical D&O claim
that is broadcasted across the media, it typically
involves a public company and a select group of
officers and board members that are being accused
of mismanagement. This alleged mismanagement reduced shareholder value and thus a
lawsuit was filed among shareholders. As an emerging privately-held technology firm,
you are probably saying to yourself “I am a much smaller company and all of my
investors have board representation….this sort of claim really wouldn’t apply to me.”
This example and the common statement among emerging technology company
executives are the reasons why little, if any, time is given to understanding the terms and
conditions within the D&O policy on a granular level.
What sorts of claims would an emerging technology company see that would trigger
D&O coverage? They would arise from stakeholders of your particular company. But to
fully understand the magnitude of who can bring these suits against the organization and
the individual D&O’s, we must first define stakeholders. A stakeholder of an
organization is any person or entity who has a stake in that specific organization.
2. Examples of these could include, but are not limited to, suppliers, customers,
shareholders, creditors, government, society, and so on. Upon understanding who a
stakeholder is and the fact that even our competitors have grounds to bring D&O suits
against us, we can conclude that ANY managerial decision about the direction or strategy
of a company could negatively affect a 3rd party … thus allowing a claim to occur.
Now that we understand what defines a stakeholder, you may ask “when should I
evaluate my D&O coverage?” To get a process that fits your organizational needs, you
will need to work with your insurance broker to understand what indication in your
business warrants an evaluation. However, a few common indications that span across the
Technology industry include: filing your articles of incorporation, extending board
membership to new individuals, evaluating mergers & acquisitions, potential divestitures,
IPO’s/other sources of funding, and management changes.
Any of the above activities, if executed poorly, could
adversely affect a 3rd party and create a D&O claim
situation.
Once you have decided that D&O is vital to the risk
management of your organization, the next step is
understanding what limit of coverage fits the company
needs? Typically, $20M revenue and less technology organizations with institutional
funding have limits of $3M - $5M+, depending on a few main items: the amount of
capital injected into the firm, the net worth of the board members, and the competitive
environment in the company’s specific niche. As the revenues increase, D&O limits may
increase as well. Additionally, micro cap public companies typically have limits between
$10M - $25M.
As the company grow, other items that would be beneficial to consider are: defenses
costs outside the limits, preferred final adjudication wording, choice of law firm, and
failure to maintain adequate insurance … just to name a few. Some of these coverages
come at an additional premium charge, which is why balancing cost and risk should be
reviewed consistently.
Below is a brief description of why these should be added or considered:
Defense Cost outside the limits – D&O suits are costly claims to defend. Having a
condition that provides additional limits or unlimited limits for defense cost is
favorable. It prevents reducing your policy limits that could be used for settlements
rendered against your organization.
Final Adjudication – D&O Liability excludes providing coverage for fraud, but
some exclude allegations of fraud. Having this condition on the policy requires that
fraud be found “in fact” and through a final adjudication by a court of law before
coverage would be excluded. This is important so that your directors and officers
are protected against groundless suits.
3. Choice of Law Firm – D&O insurance carriers have predetermined rates for the
attorneys they used to defend these claims and those attorneys many not include the
firm you prefer. Your broker could negotiate your D&O
insurance provider to allow your attorney to defend your
company in the event you are brought into litigation. As
the insured, you have much more leverage choosing
counsel before a claim occurs than after you are notified
of potential litigation.
Failure to maintain insurance – Many forms exclude
D&O suits for failure to maintain adequate insurance. This stems from a claim that
would typically be covered from another type of insurance policy, but falls under
the scope of the D&O policy because the pertinent line of coverage was not
purchased. Having this removed is imperative for technology companies because
the exposures are constantly changing and new insurance products are continuously
being developed. You may find yourself in an unfortunate situation where a loss
occurs and you weren’t aware that coverage was available for purchase in the
insurance marketplace.
The point is to be fully engaged with and rely on your insurance broker for guidance.
No one should know what your business potential threats and exposures are better than
you after discussing these exposures with your broker. Brokers can provide benchmarks
within your sector as to what your peers are doing while also providing additional
expertise allowing you to make the best decision for your organization. A quote from
Niccolo Machiavelli is relevant to finding a process to evaluate the D&O policy
consistently. “Tardiness often robs us of opportunity and the dispatch of our forces”. If
you are late to review your policies and adapt them to your needs, you may be faced with
an uncovered claim reducing the company’s ability to reduce its cost of risk.
Phillip Naples is an insurance broker in the Technology Client Division of Pritchard &
Jerden, Inc. He has been focusing on technology-related exposures for several years
during which he has assisted with the placement of technology risks to the insurance
market, developed new coverages, and speaks as a subject matter expert on technology
insurance products. Mr. Naples is active in the Technology Association of Georgia,
Atlanta Venture Forum, and is a sponsor and board member of Technology Executives
Roundtable.