A diverse group of board members The D&O and EPL premiums for coverage may seem daunting to small business owners. However, small businesses will find it even more difficult to retain the average claim cost of $120,000 and $69,000 for D&O and EPL, respectively. (Credit: fizkes/Adobe Stock)

Even in our increasingly litigious society, many small business owners think they’re too small to fall victim to directors and officers (D&O) liability claims.

As a result, they fail to protect their companies and don’t realize the error of their ways until it’s too late. According to Coalition’s 2022 Executive Risks Report, 36% of small businesses that had D&O liability coverage experienced a claim within the last two years, with the average cost eclipsing $120,000 and the highest claim extending into the millions. Making matters worse, 18% of businesses that had employment practices liability (EPL) had a claim, too, with an average cost coming in just south of $69,000.

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