Directors and officers liability insurance

What is directors and officers insurance?

Directors and officers liability insurance provides directors with cover for costs involved with legal action arising from them carrying out their duties. They can be personally liable for their legal obligations and cost of defending any claims.

What does directors and officers liability insurance cover?

It reimburses the costs resulting from law suits and judgments arising out of poor management decisions, employee dismissals, shareholder grievances and other acts committed in good faith. Possible legal action can arise from:

• employees - including wrongful dismissal, harassment, unfair work practices and unsafe work environments
• third parties  - including shareholders, bond holders, creditors, liquidators, competitors or regulators

Who needs directors and officers liability insurance?

Directors and officers liability insurance has become essential for all business leaders. Far too few directors fully understand how accountable they are for their actions, or what the implications can be for failing to conduct business in line with their duties.

A company’s board of directors and officers are personally at risk. They are accountable for all aspects of corporate governance, including business failings, oversights or omissions. Family trusts and the company’s limited liability status may not be enough to keep a director’s home and other personal assets safe.

We can advise you on the best business insurance solutions to protect you against the financial outfall of claims made against officers and company directors. However, every director’s situation is different and warrants expert advice. Your broker can provide this guidance for you. Our brokers will work with you to create a tailored, cost-effective insurance package to safeguard you and in the event of a claim, we'll work as your advocate to get a resolution for you.