Companies and officers are sued frequently ranging for a wide range of alleged harm. Regardless of the issue, there are insurance policies that in the event of a judgement or settlement, pay the cost. But this also makes the insurer into a phantom board member interested in making them into 'sheep.' So this is a fact based report: https://www.liveinsurancenews.com/elon-musk-to-cover-tesla-directors-and-officers-liability-insurance-himself/8549511/ Electric vehicle maker Tesla Inc has stated that it will be forgoing directors and officers liability insurance for the 2019-2020 policy hear. The reason they gave for skipping the coverage is that insurer premiums quotes were “disproportionately high.” That said, Tesla won’t be without any form of D&O coverage at all. Elon Musk, the company’s CEO, has stated that he will personally provide coverage “substantially equivalent” to the directors and officers liability insurance Tesla would receive from traditional insurers. Musk will provide the coverage for one year along with other Tesla board third-party beneficiaries. This was revealed in a 10K/A statement the California-based EV automaker filed with the US Securities and Exchange Commission. “The Board concluded that because such arrangement is governed by a binding agreement with Tesla as to which Mr. Musk does not have unilateral discretion to perform, and is intended to replace an ordinary course insurance policy, it would not impair the independent judgment of the other members of the Board,” read the filing. . . . What Elon has observed and I suspect is accurate, 'insurance' has become expensive with high premiums that guarantee their profits. For example, insuring a Tesla means you may be between direction from Tesla and conflicting direction from the Insurance company: Only one shop Tesla and State Farm Approved Initial $6k grew to $10k The jointly approved shop took +3 months repair for what would normally be 1 month or less Bob Wilson
