Liability insurance offers protection against risk of getting sued for negligence, malpractice, injuries and damage to people and/or property. Liability insurance covers legal costs and payouts for which the insured party would be found liable.
Directors while performing their functions/duties may sometime falter which might bring civil or criminal action against them. This policy safeguard them against these actions.
The policy protects personal fortunes of the Directors against consequences of their personal liability arising out of unwitting wrongful acts which include:
Add-ons under D&O Insurance Policy are as follows:
Limit of Liability should decided on the basis of Turnover of the Business, Employee strength, Industry Benchmarking etc.
company made the difficult decision to reduce the numbers of its staff. Business volume had declined and this was the only way forward. Upon receiving notice from the company, several members of staff consulted an “employment practice lawyer”, and they began a legal action against the company and the individual directors responsible for their dismissal.
Allegation was that one particular director had always discriminated against her on grounds of her being female and of a differing religious faith. She considered that this was why she had been made redundant.
An allocation of costs was agreed for the defense of the company (not itself insured under a D&O policy) and the defense costs for the “insured persons” i.e. directors. At the subsequent employment tribunal, the individual directors were cleared of any wrongdoing and the company reached a settlement with the former employees. D&O defense costs for the individual directors were significant.
Defense Cost should be included in the policy.
Claims from regulatory authorities. Health and safety in the workplace, statutory accounting and tax provision, compliance with governmental and regulatory authority requirements
Company director received a letter from the governmental authority responsible for overseeing the annual registration of his company accounts. This suggested he had submitted incorrect information and a fine was likely. An inquiry began.
With the agreement of D&O underwriters, assistance was provided by a firm of consultants to show that no such breach of regulations had occurred.
The client was given full assistance to device policy related to safety and other work place related guidelines, to ensure that no such issues are raised in the future.
A retroactive date is normally the date from which the insured had held uninterr...
Directors and Officers Insurance Policy (D&O) is a kind of liability insuran...
Employment Practices Liability Insurance also known as EPLI, is a claims-made in...
Defense cost is primarily all the expenses and fee charges incurred defending ag...