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What Is Directors & Officers Insurance

Directors’ and officers’ liability insurance – also known as D&O insurance – covers the cost of compensation claims made directly against your business’s directors, key managers  (officers) & trustees for alleged wrongful acts.

Why Should I Take This Cover?

In general, these ‘wrongful acts’ could arise from actual or alleged breach of trust, breach of duty, neglect, error, omission, mis-statement, libel, slander, breach of warranty of authority and wrongful trading

Directors, officers & trustees have specific duties, responsibilities and powers relating to their positions. These are usually set out in their job description or terms of reference. If a director or officer of your company is found to have acted outside of their terms of reference, civil, criminal or regulatory proceedings can be brought against them.

Directors’ and officers’ liability insurance therefore covers the cost of defending these proceedings, as well as compensation costs that arise from an unsuccessful defence.

Claims against directors, officers & trustees can be brought by an ever-widening group of people including: employees, customers, suppliers, creditors, bankers, regulatory groups and shareholders with Issues leading to litigation being as widespread as wrongful termination, discrimination, harassment, dishonesty, fraud, financial reporting and health and safety at work.

Consider….

Claims against directors, officers & trustees can be brought by an ever-widening group of people including: employees, customers, suppliers, creditors, bankers, regulatory groups and shareholders with Issues leading to litigation being as widespread as wrongful termination, discrimination, harassment, dishonesty, fraud, financial reporting and health and safety at work.

Optional Extensions

Employment practices liability insurance can be bought as an extension of directors’ and officers’ liability insurance. Developing legislation means that there’s a broad range of potential actions to consider including:

Wrongful dismissal or termination, harassment or discrimination on the basis of sex, race or religion, employment-related libel, slander or defamation, invasion of privacy, wrongful failure to employ or promote and retaliation (where the employee believes that raising a complaint has led to their employer discriminating against them).

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