There are many things directors and officers of any company must worry about on a daily basis. One of these anxieties includes lawsuits. Claims can hit a company from out of nowhere and can cost even the most prepared businesses thousands. During a lengthy legal process, you may wonder about how you can protect yourself from claims. Well, one way to do so is by acquiring civil monetary penalty insurance.
What is a Civil Monetary Penalty?
A civil monetary penalty is handled in civil court and essentially punishes those who have gained money from an illegal transaction or activity. The fine is typically equal to the amount gained. This money is then meant to return to the hands of victims.
Do You Need This Insurance?
Many industries can be subject to this type of situation. However, these penalties dominate the field of medicine, investment and banking as these involve monetary transactions. You can simply never know when you will be hit with a direct lawsuit. It is also important to consider that most directors and officers insurance does not include help during this type of civil case.
Civil monetary penalty insurance is meant to protect individuals in case of civil dispute and may not cover defense costs. To learn more about how you can build your own personal protection, contact an insurance broker or agent today.