Should a Startup Buy D&O Insurance After Fundraising?
Yes, if the round adds outside investors or board seats; if you already have D&O, review it so the new directors, entities and required limits are covered.
Yes, if the round adds outside investors or board seats and you don't have D&O yet. If you already carry it, review the policy after closing so it matches what the round changed.
Tell your insurer or broker about the round, then compare the policy with the signed financing documents. Check that new directors and any new entities fall within the policy's insured definitions, and that the limit meets what investors asked for. If the requirement is for a specific Side A, B or C limit, check whether the sides share one aggregate or whether securities claims carry a sublimit.
Report any dispute, demand or circumstance you already know about before the new policy period starts. Prior-notice and pending-litigation exclusions can stop a fresh policy from responding to it. Any change you asked for should appear in an endorsement, not just in an email from your broker.
Coverage Guides Related to D&O Insurance
Sources for This Answer
- SR 19-12: Statement Regarding Insurance Policies for Directors and Officers. Board of Governors of the Federal Reserve System; Applicability; Policy Considerations for Indemnification Insurance Policies; form/document version July 23, 2019. Accessed 2026-09-25.
- Private Company Directors and Officers Liability Coverage. Travelers Casualty and Surety Company of America; I.A–C p.1; III.A–E pp.1–2; III.J–M pp.2–3; IV Exclusions pp.3–4; VI Defense and Settlement pp.6–7; form version PDO-3001 Ed. 01-09. Accessed 2026-09-25.
- Directors and Officers insurance. Insurance Information Institute (Triple-I); What D&O covers; What’s excluded?; The added value of protecting company leaders. Accessed 2026-09-25.