directors' and officers' liability insurance

directors' and officers' liability insurance

A type of insurance taken to protect a firm's directors and officers against lawsuitsmainly suits instituted by unhappy shareholders of the firm. Directors' and officers' liability insurance has become more expensive and more difficult to obtain in recent years as the number of lawsuits has increased dramatically. Companies find it very difficult to recruit outside directors unless the candidates are supplied with liability insurance. Also called D&O Coverage.