Do Private Companies Need Directors Insurance In Canada?
Businesses have never been more transparent and accountable for their actions than they are today and as a result people are increasingly and rightfully asking do private companies need directors insurance in Canada? The short answer to the question “do private companies need directors insurance in Canada?” is yes for a number of reasons which we’ll explain more fully. However, it should also be noted that there are many different types and sizes of private companies and not all private companies need directors insurance in Canada, but the expert business insurance brokers at ALIGNED Insurance can help you and/or your board answer the question do private companies need directors insurance in Canada after reviewing the specific organizational structure and financial position of your organization.
Reasons Why Private Companies Need Directors Insurance In Canada
- Pays for legal expenses. Provided the allegation is sufficient to trigger the wrongful act and claim definitions in a directors policy a private company directors insurance policy can and will pay for the legal expenses of directors, officers and employees.
- Financial stability. Often claims against directors are unexpected and/or unanticipated and typically happen when an organization is not in a strong financial position. Private companies often need the funds made available by directors insurance in Canada to just keep a company from insolvency and help it battle through a rough patch.
- Attraction and retention of top director talent. If you have a board of directors and are looking for talented professionals to join your board like those that carry the ICD professional designation from the Institute of Corporate Directors having private company directors insurance is almost always a must have.
- Protection from stakeholders. In business things don’t always work out according to the plan(s) and if things go sideways stakeholders might bring suit against the directors and/or officers alleging breach of duty etc. which a private company directors insurance policy will defend and pay out on as/if necessary.
|ALIGNED Across Canada 100% Canadian owned, ALIGNED is a premiere insurance brokerage that serves nearly 1,400 clients across the country. As experts in delivering business insurance Canada solutions and consistently recognized as one of the best business insurance brokers in Canada, ALIGNED’s offices in Toronto, Calgary and Vancouver are supported by a national operations centre in Cambridge, Ontario. Uniquely within the industry, ALIGNED business insurance brokers create, negotiate and deliver the best business insurance and risk management strategies/solutions to organizations like yours. As one of Canada’s fastest growing insurance brokerages, we invite you to learn more about us and connect @ALIGNEDonRisk, on Facebook or LinkedIn.