This pays on behalf of the directors and officers any money owed due to negligent acts committed by them. Firms may, if the law in its locality allows, reimburse directors and officers for losses due to their negligent acts. There are three main reasons a firm may not reimburse its directors and officers. One is that some state laws do not allow reimbursement. A second reason is that the firm may not be financially able to reimburse and, third, the firm may simply choose not to reimburse.