D&O covers the personal liability of directors and officers — and the company's obligation to indemnify them — when management decisions are challenged.
Directors & Officers liability protects the people who run the company. When a shareholder, investor, employee, competitor, or regulator alleges that a decision made by management caused harm, D&O pays defense costs and settlements. Without it, those costs land on the individuals personally, and on a balance sheet that was supposed to fund product.
It is structured in three parts. Side A protects individuals when the company cannot indemnify them — typically because it is insolvent or legally barred from doing so. Side B reimburses the company when it does indemnify. Side C, entity coverage, protects the company itself for securities claims. For a private venture-backed company, Side C is usually limited to securities-type matters, which is exactly where funding-round disputes live.
Practically, D&O becomes non-negotiable the moment you have a board seat held by someone who isn't a founder. Experienced independent directors and most institutional investors will ask what your D&O tower looks like before they sign. It is often cheaper to buy than founders expect, and dramatically more expensive to need and not have.
Buy it when
Grants vary by carrier and form. These are the components we look for when we place it.
Allegations of misrepresentation or omission in connection with a financing, secondary sale, or acquisition.
Claims that directors failed their duty of care or loyalty — common in down rounds, recapitalizations, and preference disputes.
Costs of responding to SEC, DOJ, state AG, and other regulatory inquiries directed at the company or its officers.
Where an executive is personally named. EPLI is the primary policy for employment matters; D&O picks up the individual exposure.
Allegations of misappropriation, tortious interference, or unfair competition brought against officers.
Claims arising from a sale, merger, or change of control — including post-closing indemnity and earn-out disputes.
We put this in front of you at binding — the only moment you can still do something about it.
Composite scenarios drawn from how these losses typically develop. Illustrative, not case files.
Early investors allege the board breached its duty of loyalty by approving a recapitalization that wiped out their position. Defense costs exceed $900,000 before the matter resolves.
Litigation names the CEO and two board members individually. D&O funds the defense; without it, the individuals fund it themselves.
Twelve months after the sale, the buyer alleges revenue quality was misstated during diligence and pursues the former officers. The run-off (tail) policy purchased at closing is what responds.
Ranges we commonly see for technology companies. Your contracts and exposure decide the answer — this is where the conversation starts, not where it ends.
| Stage | Typical | |
|---|---|---|
| Seed | $1M | Often the first policy bought after the round closes, especially with an outside board seat. |
| Series A | $2M – $3M | Standard for institutional rounds. Retention typically $25k–$50k for securities claims. |
| Series B | $3M – $5M | Consider a dedicated Side A layer once the board grows. |
| Series C+ | $5M – $20M+ | Layered tower with Side A DIC. Pre-IPO structures are a distinct exercise. |
What we need to quote
Most of this is collected once in the Atlas submission and reused across the markets we approach.
Start a submissionUsually not until you take institutional money or add an outside director. The moment there is a board seat you don't control, buy it.
It protects you only to the extent the company has money and is legally permitted to indemnify. In insolvency or in a derivative suit, indemnification is exactly what fails. That is what Side A exists for.
You buy a run-off, or tail, policy — typically six years — at closing. It is almost always negotiated into the purchase agreement. Plan for it early; buying it under time pressure is expensive.
Only the individuals named, and only in a limited way. EPLI is the correct policy for wrongful termination, discrimination, and harassment claims against the company.
Build a SaaS insurance checklist around customer contracts, data, employees and funding. Know what to prepare before requesting quotes.
Read the guide: SaaS Insurance Checklist for Founders and Finance TeamsCompare technology insurance quotes beyond premium: limits, retentions, exclusions, defense costs, retroactive dates and binding requirements.
Read the guide: How to Compare Technology Insurance QuotesPrepare for a startup D&O review with questions about board protection, company coverage, financing requirements, exclusions and prior acts.
Read the guide: D&O Insurance for Startups: Questions Before a Funding RoundTell us about the business once. A broker reviews it the same business day and comes back with a plan and a timeline.
