According to the Financial Times, Nvidia's lack of comprehensive Directors and Officers (D&O) liability insurance, commonly purchased by large publicly traded companies, could expose the company to greater litigation and financial risks following Jensen Huang's departure and related controversies. Nvidia currently holds up to $900 million in Category A insurance through Aon, primarily covering the personal assets and legal defense costs of directors and executives. However, it lacks Category B and C insurance, failing to adequately cover compensation, legal fees, and class-action lawsuits arising from executive misconduct. Industry insiders point out that large US publicly traded companies typically purchase comprehensive coverage across all three categories (A, B, and C), making the purchase of only Category A insurance extremely rare. While Nvidia's existing $900 million Category A policy may cover some shareholder-related litigation, the lack of Category B and C coverage means that in the future, if a class-action lawsuit arises due to a decline in stock price, the company may have to bear more litigation and financial costs itself.
