Civil liability policy D&O – the backup for inspired decisions

Civil liability policy D&O – the backup for inspired decisions

 Do you need a D&O policy?

No matter how certain we feel about the decisions we take every day, we are also aware that we can never fully control neither their outcome, not the impact they have on our lives.

Things are becoming even more complicated when we talk about decisions or actions that affect the lives of hundreds of employees or that involve extremely large sums of money: those taken by the ones who lead companies.

In such cases, the impact of a wrong call can become extremely difficult to manage.

Members of the Board of Directors, as well as CEOs, CFOs or COOs are all fully responsible for their decisions and actions. A D&O policy can insure their financial protection in case the outcome is not what it was expected.

What is a D&O policy and who should buy it? 

The D&O policy represents a civil liability insurance dedicated to directors and officers which protects them financially in case they generate losses to their company or to another entity as a result of their decisions or actions.

Buying D&O policies has become a market standard among large companies because, firstly, this product offers a sense of security to managers, and secondly, it shields the company as well.

When can the management of a company be held responsible? A few examples

Administrators and executive directors can be held responsible for their actions not only by the company’s shareholders, but also by employees, creditors or even… competitors.

For example, in 2014, Kim Barovic, shareholder of Microsoft has brought a lawsuit against the company, claiming that directors and executives – including founder Bill Gates and former chief executive Steve Ballmer – failed to manage the company properly, and that the board’s investigation into the incident which lead to Microsoft being fined by European antitrust regulators was insufficient ((Web source:The Telegraph 14.04.2014).

In 2013, the case of an employee from a library in Teaneck, New Jersey, was making rounds in newspapers’ pages. The senior library assistant filed a sexual – and workplace harassment and gender-discrimination lawsuit against the director, claiming he created a hostile work environment (NorthJersey.com 15.08.2013)

To cover such cases, D&O policies may include an extension for Employment Practices Liability, which – among other scenarios – encompass cases of discrimination, harassment, wrongful termination, demotion or failure to promote, retaliation etc.

Why should you buy a D&O insurance policy from CertAsig? 

CertAsig offers companies a simple, yet powerful insurance product, built to answer the needs of directors and executives no matter the field in which they activate. Thus, the D&O policy covers:

  • Financial damages caused to the company the Insured leads/ manages due to business decisions made by the Insured person during the decision-making process;
  • Damages caused to third parties, caused by decisions taken by the Insured as leader/ manager of the company, for which the Insured is accountable according to the law;
  • Legal costs.

Moreover, the D&O policy offered by CertAsig is a flexible financial product and can be extended to include among others:

  • Investigation costs & legal expenses costs;
  • Civil fines & penalties;
  • Reputation expenses;
  • Corporate manslaughter;
  • Discovery period etc.

How can you buy a D&O insurance policy from CertAsig?

CertAsig specialists are always at your disposal, ready to give you additional details and providing you the necessary support to choose the optimal solution best suited to your needs. Please contact us at office@certasig.ro.

 

 

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