General liability covers the business. Directors and officers liability covers the people who run it. Most small business owners don't know the difference until they're named in a lawsuit personally.
Your client's general liability policy covers the business. Their BOP covers their property and operations. What neither of those policies covers is a lawsuit brought directly against the people who run the business — the owner, the officers, the board members.
What D&O Actually Covers
Directors and officers liability covers the personal liability of individuals who make decisions on behalf of a company. When someone — an employee, a competitor, an investor, a regulator — claims that a business decision caused them harm, they can sue the people who made the decision, not just the business entity. D&O pays for defense costs and any resulting settlements.
The coverage sits outside the business's property and liability program. It's designed specifically for the personal exposure that comes with being the one who makes decisions.
Who Actually Needs This
The reflexive answer is large corporations with real boards. That's where D&O originated. But the risk doesn't stay there.
A small business owner who serves as the sole officer, has investors or silent partners, has employees making employment-related decisions on their behalf, or sits on any kind of board or advisory committee — all of those are scenarios D&O was built for.
The business owners most at risk of thinking they don't need it are the ones where the owner and the company are practically the same person. In those cases, a judgment against the officer of the company lands directly on the individual behind it.
The One Question That Opens the Conversation
Most small business clients have never heard of directors and officers liability. That's the opening.
Ask them: if a former business partner, an investor, or a key employee decided to sue you personally — not the business, but you — what policy covers that?
Let them work through it. They'll usually land on nothing, which is the right answer and the right starting point for the conversation.