D&O Insurance

Also known as D&O insurance, director’s and officer’s liability insurance provides liability for individuals who oversee an organization. This policy is intended to protect these individuals from allegations of negligence or negligent acts during the course of running the business or not-for-profit enterprise. As the individuals insured are often considered accountable for the actions or inactions of the organizations that they are overseeing, D&O insurance is often considered an integral part of an effective risk management program.

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Directors and Officers Liability Insurance

Also known as D&O insurance, director’s and officer’s liability insurance provides liability for individuals who oversee an organization. This policy is intended to protect these individuals from allegations of negligence or negligent acts during the course of running the business or not-for-profit enterprise. As the individuals insured are often considered accountable for the actions or inactions of the organizations that they are overseeing, D & O insurance is often considered an integral part of an effective risk management program.

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D&O Insurance vs. Personal Liability Insurance

A D&O insurance policy differs from a personal liability insurance policy because it does not provide coverage for defense costs, which can often be a substantial portion of the claim. Other variables to note include:

  • Written on a claims-made basis
  • Have no duty to defend the insured in the case of a for-profit business
  • Cover monetary damages
  • Does not cover bodily injury or property damages

D&O Insurance Liabilities Can Occur in the Following Instances:

  • Allegations of breach of common law duties
  • Breach of duties to shareholders
  • Statutory liabilities at the state or federal level

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Whether you are the director of a public, private or not-for-profit organization, the insurance specialists at King Street Agency can design a policy that is right for you at the best rate. We have been helping directors of businesses in Charleston and across South Carolina for more than a decade. We have the experience, knowledge and carrier networks to give you the peace of mind you need.

Call us today for more information, or request a directors and officers insurance quote today.

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Frequently Asked Questions About D&O Insurance in South Carolina

Directors and Officers insurance—commonly called D&O insurance—protects company directors, officers, board members, and executives from personal financial loss resulting from claims alleging mismanagement, negligence, errors, or breaches of duty while running an organization.

D&O insurance is essential for:

  • Public and private companies
  • Nonprofit organizations
  • Board members and trustees
  • Corporate officers and executives
  • HOA boards and community associations

Anyone responsible for governance or decision-making can be personally named in a lawsuit.

D&O insurance is not legally required, but it is often required by investors, lenders, regulators, or board bylaws. Many organizations cannot recruit qualified board members without it.

D&O insurance may cover:

  • Legal defense costs
  • Settlements and judgments
  • Claims alleging breach of fiduciary duty
  • Misrepresentation or misleading statements
  • Employment practices-related claims (depending on policy)
  • Regulatory and statutory violations

Coverage applies even if allegations are unfounded.

D&O policies generally do not cover:

  • Bodily injury or property damage
  • Fraud or criminal acts
  • Personal profit or illegal gain
  • Prior known acts not disclosed

Other insurance policies may be required to cover these risks.

Personal liability insurance protects individuals from everyday risks, such as injuries at home. D&O insurance specifically protects directors and officers from claims related to management decisions, governance, and fiduciary responsibilities.

D&O insurance is written on a claims-made basis, meaning the policy must be active when the claim is made, not just when the alleged act occurred. Continuous coverage is critical to avoid gaps.

Yes. Nonprofit organizations face many of the same governance risks as for-profit businesses. D&O insurance helps protect nonprofit board members and officers from lawsuits brought by donors, employees, beneficiaries, or regulators.

Some D&O policies include or can be endorsed to include Employment Practices Liability (EPL), covering claims such as wrongful termination, discrimination, or harassment. Coverage varies by policy.

Coverage needs depend on:

  • Organization size and revenue
  • Number of board members and officers
  • Industry risk
  • Regulatory exposure
  • Investor or lender requirements

Many organizations carry limits starting at $1 million, with higher limits for larger or higher-risk entities.

Premiums vary based on:

  • Type of organization (nonprofit vs for-profit)
  • Annual revenue
  • Claims history
  • Governance structure
  • Coverage limits and deductibles

Nonprofits often have lower premiums, while public or investor-backed companies typically pay more.

D&O policies are often described in terms of Sides A, B, and C coverage. Side A protects individual directors and officers when the organization cannot indemnify them, paying their defense costs and any covered settlements directly on their behalf. Side B reimburses the organization when it does indemnify its leaders, while Side C (usually for public companies) protects the entity itself for certain securities or organizational claims.

Yes, most D&O policies cover past, present, and future directors and officers for wrongful acts committed while they were serving in an insured capacity. That means former board members can still be protected if a claim surfaces later, and newly appointed directors are typically covered automatically as soon as they join, subject to the policy terms and any underwriting conditions.

South Carolina organizations face increasing scrutiny from investors, employees, regulators, and community members, especially around governance, employment decisions, and financial stewardship. Directors and officers here can be sued over hiring and firing, mismanagement of funds, merger or acquisition decisions, HOA enforcement actions, or alleged failures to follow bylaws and state statutes, making D&O protection a key part of a modern risk strategy in the state.

Insurers typically ask for basic organizational and financial details, including your entity type (nonprofit, private company, HOA, etc.), years in operation, and recent financial statements. They also want information about your board and leadership structure, bylaws and governance practices, prior or pending claims, and the limits and coverage options you’re seeking, such as whether you need Employment Practices Liability bundled with your D&O.

Because D&O is usually written on a claims-made basis, coverage depends on when the claim is made and whether the policy is active at that time. If you switch carriers or cancel coverage, you may lose protection for future claims arising from past acts unless you maintain continuous coverage or purchase an extended reporting period (“tail”) so claims reported later are still covered.

Your bylaws and indemnification agreements are generally the first line of protection, requiring the organization to defend and reimburse its directors and officers when they are sued for actions taken in good faith. D&O insurance is designed to backstop that promise—reimbursing the organization for those indemnified costs, or stepping in directly for individual directors if the organization is unable or unwilling to indemnify them (for example, due to insolvency or legal restrictions).

Board members should review a few key points at renewal:

  • Are the policy limits still appropriate for our size, assets, and risk profile?
  • Are there any new exclusions or changes in terms that reduce coverage?
  • How much pure Side A protection do individual directors have if the organization cannot indemnify them?
  • Is the insurer financially strong and experienced with organizations like ours in South Carolina?

These questions help ensure the policy still matches the organization’s governance risks and the board’s expectations.

KSA Insurance has helped directors and officers in Charleston and across South Carolina for over a decade, offering deep carrier access, governance expertise, and tailored D&O solutions for businesses and nonprofits alike.

You can request a quote online or contact KSA Insurance directly. Be prepared to provide details about your organization, leadership structure, financials, and risk exposure.

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Whether you are the director of a public, private or not-for-profit organization, the insurance specialists at King Street Agency can design a policy that is right for you at the best rate. We have been helping directors of businesses in Charleston and across South Carolina for more than a decade. We have the experience, knowledge and carrier networks to give you the peace of mind you need.

Call us today for more information, or request a directors and officers insurance quote today.

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