Are you an appointed Director or Officer? Does your business have appointed Directors or Officers, Employees or Undertake Transactions?
If yes, then Director’s & Officer’s Liability (D&O) is intended to protect (the personal assets of) directors and officers, as well as the Company against alleged wrongful acts committed in the management of the company; for which Directors & Officers of a company can be personally liable under legislation and civilly.
These responsibilities could include shareholder, investor, debt provider, corporate & legislative issues, superannuation, tax, employee, fraud, contractor, competitor and consumer matters. The onerous obligations thrust upon managers and directors continues to grow; and so does the potential financial impositions i.e. legal and punitive.
Legal defence costs can often be the most significant cost, in protecting the reputation of the individual or corporation in court and at official inquiries; as well as defending a claim brought by investors, shareholders, competitors, regulators, vendors, creditors, or customers.
These legal proceedings can include actions brought by regulators, consumers, competitors, shareholders, employees, which can include Class Actions and Criminal charges, where the defence costs can exceed business or persons financial capabilities.
The policy can also cover:
- Workplace Health & Safety incidents, but not all fines & penalties
- Employment Practices issues
- Crime&/or fraud; and
- Statutory Liability
Prospectus Liability
A Directors and Officers (D&O) policy can provide coverage for prospectuses or Information Memorandums issued to raise capital or debt. Alternatively, it’s preferable to obtain a separate, discrete, multi-year policy with a ringfenced sum insured/policy limit specifically for the capital or debt raising. This approach safeguards the individuals issuing or signing off on the Prospectus/Information Memorandum as well as the organization. Additionally, there’s an option to include consultants involved in the capital or debt raising process.
Business this is recommended for:
Any business with appointed Directors and Officers as well as employer organisations, trading companies and the like.