Directors and Officers Liability / Company Reimbursement
Directors’ and/or Officers’ of both private and public companies can be exposed personally to liability arising from claims or allegations of wrongful conduct (mismanagement of the business), whilst discharging their duties. There are approximately 700 laws that impose duties on Directors’ and Officers'(e.g. the Corporations Act, the various state Workers Compensation and Occupational Health & Safety Acts, Consumer Protection Legislation, etc.). Common Law actions may also attract personal liabilities.
Potential sources of allegations that may lead to legal action are; Shareholders, employees, customers, suppliers and regulatory bodies. The personal assets of a director or officer may be at risk in such circumstances, particularly if the corporate entity does not have the financial capacity to provide an indemnity, refuse to provide an indemnity or is legally prohibited from indemnifying its directors and officers.
Most policies automatically provide cover to all past, present and future directors and officers for allegations or claims made against them.
Under the Company Reimbursement section of the policy, coverage is provided to the company to indemnify it where it has provided an indemnity to its’ D&O’s. Any indemnity granted must not breach Section 199A of the Corporations Act.
If you would like to obtain a quotation for this cover, we recommend reading our fact finding document and then contact us.