Tip: Find out how your policy treats defense costs. Are they included in the policy limit or furnished in addition? Do your defense costs count toward the self-insured retention?
Instead of a deductible, a D&O policy normally includes a self-insured retention, causing the policyholder to bear some front-end risk and participate in the total cost of the claim. The retention is usually a dollar amount and may apply separately to the organization and to individuals insured.
The self-insured retention usually includes defense costs, so that payments for defense satisfy the retention.