In today’s increasingly litigious society anyone who is a Director or who holds a significant position of authority within a company, charity or any institution run by a board (including clubs and residents associations) is at risk of having a claim made against them. It is important to realise that Directors of limited companies do not have limited personal liability – their personal assets could also be at risk.
If a Director or Officer is accused of committing a wrongful act, such as neglect or breach of duty/trust, they may also have to meet any losses arising out of any litigation, such as any legal costs or actual damages awarded.
Claims can arise under the following areas:
- Companies Act
- Health & Safety at Work
- Insolvency Act
- Data Protection Act
- EC Regulations / Legislation
- Environmental Protection Act
- Employment Practice Legislation
- Breach of Trading Standards
- Customers / Clients
- Investigation costs.
If a claim does arise that the company cannot or will not meet, the Director / Officer would have to use their personal resources to defend themselves in the absence of insurance cover.
Directors and Officers cover provides indemnity in respect of these costs. This means that the company and the individual are no longer at risk of having to meet such costs provided the policy will indemnify.
Cover can be extended to include:
- Employment Practice Liability
- Corporate Practice Liability
- Pension Trustee Liability
- Crime Cover