Are Directors and Officers covered when they are sitting on an Outside Board?
Some companies often ask their Directors to contribute their time and talents to community activities, including service as directors, officers, or other leaders of nonprofit and for-profit organizations. Most Directors and Officers Liability policies extend coverage in situations where the Company and its Board has specifically requested a Director or Officer to sit on the board of another Outside Entity. Coverage is normally extended to non-profit organizations, 501 (c) (3); but coverage is not an automatic extension for a for-profit board. This coverage may be available with prior underwriter approval and additional premium. NOTE: Its important to know that the coverage extension for Outside Directorship Liability only applies to the individual and is only excess of any insurance available from the Outside Entity.
