A lawsuit can be detrimental to the workings of a business, as it can stall productivity for long periods of time, resulting in loss of income.  In addition, if there is monetary settlement as part of the ruling of the lawsuit, it can result in further loss of assets.  These are common concerns when a company is faced with a lawsuit.  Often overlooked is the officers and directors of a business and how the lawsuit affects them personally.  Decisions that the men and women in these upper level positions make can create discontent among consumers, which can result in lawsuits.  E&O insurance protects them from lawsuits and helps to cover any settlements and legal fees that may be incurred during the legal proceedings. The integrity or correctness of the lawsuit is not in question; even if there is no fault associated with the directors and officials, there can be serious legal bills, and this insurance can ensure that those involved are not bankrupted.