Directors and Officers Liability Insurance: Prior Acts Coverage
Directors and Officers (D&O) Liability Insurance (or Association Professional Liability Insurance) provides coverage for the directors and officers of an association, as well as the association itself for the cost of defense and claims arising from lawsuits alleging that the directors or the association failed to properly perform their required duties. Every association should maintain continuous Directors and Officers Liability Insurance to provide funds for defense and to protect directors' and association assets in the event of a claims award.
There are numerous pitfalls that associations must be aware of when purchasing and maintaining continuous coverage for directors and officers. These will be discussed in future newsletters. This article will discuss the importance of "Prior Acts" coverage or an "Extended Reporting Period Endorsement."
