Directors and Officers Insurance provides protection for senior members of staff should any allegations of wrongdoing be bought up against them, such as breaches of duty, neglect, errors, omissions and misstatements. As these allegations can come from anywhere – employees, shareholders, regulators, customers, suppliers, the Government and other directors – it’s imperative that personal assets and finances are covered, as these cases, even if they don’t end up going to trial, could still be expensive.
Directors and Officers Insurance covers defence costs and compensation for a range of different claims, including wrongful trading, environmental hazards and health and safety breaches.
Directors & Officers Insurance can be broken down into different options, such as:
Director And Officer Liability
Director And Officer Liability provides protection against claims of professional negligence, defamation and breaches of trust, as well as the costs of company investigations. Breaches of trust include disclosure of company accounts, misrepresentation and making decisions beyond the realm of the officer’s responsibilities. Extensions include reputational recovery and environmental violations.
Common exclusions include fraud, personal profit, property damage and bodily harm.
Corporate Liability
Corporate Liability guards you against claims made by investors, shareholders and HMRC, as well as covering any investigations relating to corporate manslaughter. Claims could include that of pollution, failure to abide by taxation guidelines and misuse of data, such as breaching data protection legislation. Extensions include business reimbursement in situations where they are allowed to pay the defence costs.
Common exclusions include:
- If the director or officer was aware of a misstatement or omission.
- Claims relating to infringements of patents, trade marks, copyright, intellectual property rights or registered designs.
- Losses because of failures to provide professional services.
Entity Employment Practice Liability
Entity Employment Practice Liability protects employers from claims made by past, current or potential employees, such as harassment, discrimination, wrongful termination, unfair evaluation, failure to promote and breach of employment contract. Extensions include loss of employee data, as well as training and programme costs associated with any claims.
Common exclusions include costs linked with any obligation enacted under the Disability Discrimination Act or Equality Act, as well as employment benefits and consultations.
To prevent these kinds of lawsuits, we advise that a business does the following:
- Enact a ‘zero-tolerance’ policy concerning abuse, harassment and discrimination, with an ‘open door’ policy where employees can report issues without worry of repercussions.
- Record all instances of employee issues and what the business did to resolve them. Learn from past mistakes and don’t make them again.
- Conduct fair and frequent employee performance reviews.
For Prospective Employees:
- Design successful hiring and screening programs that weed out unsuitable candidates before the interview stage and avoid discrimination in hiring.
- Create job descriptions that clearly state the needed skills and experience.
- Clearly state in contracts that if hired, employment can be terminated under certain circumstances.
Employee Dishonesty
Employee Dishonesty relates to policies that cover fraudulent activities such as employee thefts, safe burglaries and forgeries. Extensions include third party computer fraud, funds transfer fraud, credit card fraud and counterfeit fraud, as well as covering the costs of restoring data and rewriting and amending of software to prevent future fraudulent events.
Common exclusions include indirect loss, pollutants, bodily injury, property damage and restraint of trade.
Another policy option is Pension Trustees Liability, concerning wrongful acts and financial loss in relation to pension schemes.
Our range of Directors & Officers Insurance includes:
- Director And Officer Liability.
- Corporate Liability.
- Entity Employment Practice Liability.
- Employee Dishonesty.
If you would like to learn more about our policies and how we can protect your senior employees, then why not pop into our office for a brew and chat to discuss your options.
Alternatively, call us today on 0161 710 3043 or email us at info@jonsimoninsurance.co.uk.
