Management liability: why fast-growing companies outgrow basic D&O
Directors and officers cover is only one part of the picture. Fast-growth companies need broader protection around decisions, employment and crime risk.
Management liability is often described as D&O insurance, but that undersells the risk. The policy can also respond to employment practices claims, statutory liability, crime and company reimbursement, depending on how it is placed.
Growth changes the exposure
Hiring quickly, raising capital, adding overseas entities and bringing on new investors all create decisions that can be challenged later. A basic policy may not be enough once governance becomes more complex.
The board needs evidence
Investors and independent directors increasingly ask whether the program has been benchmarked, whether limits are adequate, and whether exclusions are tolerable for the company stage.
Renewal is strategy
Treat renewal as a governance exercise, not a quote collection. The broker should understand cap table changes, board composition, runway, planned raises and any employment issues before approaching the market.