Higos Insurance Services urges all company Directors & Officers to ensure they have appropriate cover in place. Directors of companies are now held personally responsible, at an unprecedented level, for actions and decisions they make on behalf of the company, putting their personal assets at risk if those decisions are tested in the courts. Legally the directors of a company, and the company itself, are separate entities and so may both be defendants, separately or jointly, in any legal action or prosecution. To protect the personal assets of individuals and, crucially, to cover the costs of their defence, Directors & Officers insurance is widely used. There are different levels of cover available in todays market. The best policies provide cover for Directors & Officers, Corporate Legal Liability (including corporate manslaughter) and Employment Practice Liability. Directors & Officers Cover Personal protection for directors, officers and senior employees of a company. For example, claims from shareholders, allegations of wrongful trading, prosecution by regulatory agencies. Corporate Legal Liability Cover Protection for claims made against the company for financial loss. For example, prosecutions by regulatory agencies or claims from third parties such as competitors or business partners. Employment Practice Liability Cover Protection for the company against claims by employees for breaches of employment conditions or regulations, such as unfair dismissal, racial discrimination or age discrimination. Claim Example: In October 1997 a driver fell asleep whilst driving for a family-run company for which he was employed. Two motorists were killed. The court held that the operations manager should have ensured his driver adhered to the relevant driving regulations. He had also failed to keep in close touch on these matters with his co-director. Both directors incurred substantial defence costs before being convicted of corporate manslaughter. Directors & Officers insurance cover has evolved over the last few years andhere at Higos we consider it to be an essential part of every limited companys insurance requirements.
Higos Urges Company Directors & Officers To Seek Appropriate Cover