Directors and Officers Liability Insurance (D&O insurance)
Directors of SME's and start up companies may not be so aware of the potential threat they are exposed to. However, Directors' and Officers' Liability Insurance is just as relevant to you, as to the board members of large national or multi-national organisations, who recognise the risks which go hand in hand with their roles.
Your own personal wealth could be at risk
Irrespective of a company’s ‘Limited’ status, Directors can be legally liable for decisions made on the company’s behalf, whether or not they were directly involved, or are being remunerated for their role. Directors and officers can be personally sued by shareholders, creditors, employees, suppliers, customers, competitors or regulators.
You can be held responsible for a range of issues including:
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health and safety
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data protection
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maintaining satisfactory accounts
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fraud
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negligence
Directors' insurance provides financial protection for acts undertaken in the running of an organisation, as well as those involving negligence and breach of trust from an honest mistake.
Defending a claim can prove expensive, as experts and professionals are called in to represent you. Therefore, it is vital that there is adequate cover in place to encompass these costs, and ensure that your business, whether large or small, is not financially affected.
With all stakeholders being potential sources of legal action, and new laws being introduced, the possibility of becoming embroiled in an official investigation or litigation is heightened. Organisations are realising the importance of Directors' and Officers' insurance and the place it has in their insurance portfolio.
Ensure that you don't get caught out, get your Directors' Liability Insurance policy in place now.