Entoro Insurance Services Monthly Newsletter Mar 14

March 14, 2023

Directors and Officers Insurance Benefits

Risks of Improper D&O Placement: Lessons from a Board Member

As a board member, it is crucial to ensure that you are properly covered under Directors and Officers (D&O) insurance. Failure to do so can have significant financial and legal consequences. Consider the following scenario:

A board member of a private company that was sued for securities fraud had assumed that they were covered under the company's D&O policy. It was later discovered that the policy did not extend coverage to individual board members. As a result, the board member was forced to pay for their own legal defense and ultimately had to settle the case for a substantial amount out of their own pocket.

This scenario highlights the importance of thoroughly reviewing and understanding the terms and conditions of your company's D&O insurance policy to ensure that it provides adequate coverage for individual board members. Improper placement of D&O coverage can leave board members vulnerable to significant financial losses and legal liabilities. Entoro Insurance Services, LLC (EIS) helps board members take an active role in ensuring they are properly covered. Contact EIS today to learn more.

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Success Story of the Month

Cybersecurity Insurance

EIS was approached by a large company that had been struggling to find an effective way to protect their sensitive data and employees from cyber threats. With a workforce of over 500 employees, the company had amassed a significant amount of data that required secure storage and protection. However, their existing cybersecurity measures were inadequate, leaving them vulnerable to cyber-attacks.

After thoroughly analyzing the company's data and existing security measures, the experts at EIS recommended that the company purchase cybersecurity insurance. This insurance policy would provide comprehensive coverage against data breaches, cyber-attacks, and other security threats. It would also cover the costs of any legal fees or damages that the company might face in case of a security breach.

The company was initially hesitant, but EIS's experts were able to explain to them of its importance and value. They explained that cyber threats are becoming increasingly sophisticated and that it was better to be safe than sorry. In the end, the company agreed to take out the policy.

A few months later, a cyber-attack targeted the company's database, and sensitive data was compromised. Thanks to the cybersecurity insurance policy recommended by EIS, the company was able to recover quickly and with minimal financial impact. The policy covered the costs of investigation, forensics, and notification, as well as the legal fees associated with the incident.

The company was grateful for EIS's unwavering support throughout the process. They praised EIS for their professionalism, knowledge, and responsiveness, which made the entire process much easier to handle. As a result, the company now recommends EIS to other businesses looking for reliable cybersecurity insurance solutions.

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Insurance for Thought

Section 7702 Plans: A Superhero of Financial Products

Hey there, financial planners and savvy savers! Have you heard about Section 7702 plans? No? Well, let us tell you, they're like the superhero of financial products, saving the day for your financial goals and dreams.

Section 7702 plans, also known as cash value life insurance policies, can be an exciting and valuable tool for those looking to invest in their future. Why? Because they offer the best of both worlds: a death benefit AND a cash value component. Talk about double the fun!

The cash value component is like the bonus round in a game show. It accumulates tax-deferred, which means you don't have to pay taxes on those investment gains until you withdraw them. It's like winning big and not having to share your winnings with Uncle Sam until you're ready. Winning!

But wait, there's more! Section 7702 plans also offer flexibility in terms of premiums and death benefit options. You can choose to pay more to accumulate cash value more quickly or opt for a lower premium and slower accumulation. You're in the driver's seat, and who doesn't love feeling in control?

Speaking of control, Section 7702 plans also offer liquidity. You can borrow against the cash value of your policy or even surrender the policy for its cash value if needed. It's like having your own personal financial superhero, ready to come to your rescue when you need it most.

And let's not forget about the protection. The death benefit can provide peace of mind for your loved ones in the event of your untimely passing, while the cash value acts like a trusty sidekick, always there to provide support and stability.

So, there you have it, folks. Section 7702 plans are like the superhero of financial products, ready to save the day for your financial goals and dreams. With tax-deferred growth, flexibility, liquidity, and protection, what's not to love? It's time to suit up and start your financial journey today! It's important to consult with a financial professional to determine if a Section 7702 plan is right for your individual needs and circumstances.

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Entoro Insurance Services

Entoro Insurance Services, LLC (EIS) is a Texas-licensed insurance brokerage. We are a trusted partner dedicated to continuous improvement, professionalism, and the highest ethical standards in the industry.  Our focus is delivering specialized insurance solutions, protecting client assets, managing risks, and ensuring peace of mind. We help clients limit liabilities allowing them to focus on what matters.

EIS Contacts

Doug Higgins
Managing Partner
Entoro Insurance Services, LLC
D: +1 863.581.6194
E: dhiggins@entoro-insurance.com

Laura Garza
Director, Operations
Entoro Insurance Services, LLC
D: +1 832.987.2484

E: lgarza@entoro.com