Directors & Officers Insurance
However complex your directors and officers insurance requirements, RPLovatt can offer the complete service you expect from an established specialist in this sector. Our relationships with insurers give us access to a wide range of specialist insurance products.
Appointment to an executive or non-executive position brings not only personal prestige but may also bring potential personal liability for a negligent act, or an act outside the appointee's authority or which is in breach of duty or trust. Today's shareholders, employees, regulatory authorities, customers and creditors expect more from directors and officers and their companies than ever before. Their conduct and integrity is scrutinised with new vigour. Directors or officers can be held responsible for actual or alleged wrongful acts, errors or omissions, including negligent advice, mis-statement or improper disclosure. Additional risk arises during the merger, take-overs and acquisitions process as the slightest error or oversight could leave them exposed to legal actions from a variety of sources.
Why Insure?
In the current regulatory climate there is an increasing focus on the affairs of companies and their officials. Directors and officers are having to operate in a difficult corporate environment. New challenges and risks are faced in the light of increasing world-wide legislation and high profile media coverage. Mistakes can happen in the course of running the business that adversely affect shareholders, employees, creditors and other interested parties of the company. In these times of high consumer awareness such parties may decide to sue.
How the cover operates
- Claims made policy i.e. claims made in the policy period regardless of occurrence date.
- Aggregate limits - costs inclusive (as opposed to costs in addition).
- Advancement of defence costs by the Insurer so the directors are not out of pocket.
What is covered?
- Civil awards, judgements and legal defence costs arising out of wrongful acts committed, or alleged to have been committed.
- Allegations of a criminal nature are covered but only for legal defence costs incurred - if proven then any fines or penalties imposed are not covered.
Extensions
- Outside positions - covers directors and officers when sitting on the board of Associated Companies.
- Pollution - defence costs and shareholder actions for any loss e.g. loss in value of shares.
- Company cover for shareholder costs - order of court to cover shareholders costs in pursuing a claim against an insured person in the company.
- Employment claims - covers past, current and prospective employees (deals with discrimination in the interview process).
What is not covered?
- Proven fraud and illegal profit.
- Pension trustee exposure.
- Insured versus insured. Cover will vary in response to directors suing fellow directors.
- Professional indemnity. A director who also acts as an engineer is not covered for their advice as an engineer under a D&O policy.
- Prior circumstances and litigation e.g. situations aware of in advance purchasing the policy.
Who is covered?
- Directors of the company including non-executive directors and shadow directors.
- Officers of the company including Company Secretary, Chief Accountant, Personnel Manager.
- Managerial and supervisory positions.
- Employees when joined as co-defendant.
- Persons appointed by the company as liquidator administrator.
If you need any further information, please contact us.
