More on the A-B-Cs of D&O Coverage

Irvine business attorneyAn important role your Irvine business attorney can play is helping you make sure your business has appropriate insurance coverage. One area your Irvine Business Attorney can help you address is whether your company needs “Side-C” Directors & Officers, or D&O, coverage and employment practices liability insurance, or EPLI.

Side-C Coverage

Your Irvine Business Attorney will explain that, unlike Side-A and Side-B coverage that focus on claims against directors and officers, Side-C coverage addresses claims against the company. Typical D&O policies exclude claims based on violations of Federal and State securities laws. Side-C coverage closes this loophole. When a securities-related lawsuit names both the company and individual directors and officers as defendants, Side-C coverage will cover the costs of defense and the company’s separate share of any judgment or settlement. Since this scope of coverage is narrow, your Irvine business attorney can help you decide whether obtaining Side-C coverage is worthwhile.

Employment Practices Coverage

Along the same lines, typical basic D&O policies exclude coverage for wrongful employment practices, such as wrongful dismissal, sexual harassment and violations of employment discrimination laws. Consequently, your Irvine business attorney will suggest looking at EPLI. EPLI can cover both direct claims by employees and administrative or regulatory proceedings. It can be added to the D&O policy or obtained as a separate policy.

Evaluating Policies

Once you’ve decided to obtain Side-C coverage or employment practices insurance, your Irvine Business Attorney can help you evaluate the different policies available. Although the basic elements of D&O Side-C coverage and EPLI policies are the same, there is no standard form of policy and specific details can vary among different policies. Your Irvine business attorney can help you compare policies by looking at elements such as exclusions from coverage and handling of defense costs.

An Irvine business lawyer at Daily Aljian LLP  can help you determine your needs for D&O coverage and EPLI. Call (949) 861-2524 to arrange for a consultation.

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