Directors’ and Officers’ Liability insurance helps protect the individual and the long-term stability of a company against the high cost of litigation. Directors, managers and employees are all subject to various duties and standards when performing their roles. This may be as simple as acting in the organisation’s best interests to compliance with legal and regulatory standards.
If an individual doesn’t meet the standards required, they could be held personally liable through civil, criminal or regulatory action.
Directors’ and officers’ liability insurance is intended to protect these people and is to cover the legal defence costs and reimbursing associated fines and penalties, where it is legally allowed.
Most policies now typically include some protection for the organisation itself where it has paid claims in order to protect individual directors or officers.
Employment Practices Liability covers legal liability of directors, officers and managers and the organisation itself, in respect of breach of employment contracts relating to; wrongful dismissal, sex, race or disability discrimination.
Pension Trustee Liability Insurance provides protection to trustees, employees, the company itself as well as the actual fund against claims brought against them for actual or alleged wrongful acts which have placed the plan’s assets at risks.
In recent years the prevalence of directors and managers being pursued has increased significantly and it is important to consider this cover within your risk management strategy.