Why businesses need Directors & Officers Insurance

D&O InsuranceDirectors and Officers Insurance is designed to cover an individual’s legal costs in cases of negligence or malpractice, and as everybody knows court costs quickly add-up. Life is becoming increasingly litigious and allegations of wrongdoing can be brought by any number of people from competitors and customers to colleagues. D&O insurance is an essential safeguard for any size of business, and Quoteline Direct explains why: 

Personal Wealth As a director you’ll be aware that you are responsible for what happens in your company, but you might not be aware that you have unlimited liability in cases of negligence; which means your personal assets could be at risk.

Litigation Culture It’s impossible to ignore the fact the country is becoming increasingly litigious. The cost of mounting a legal defence in court can be crippling even if the allegations are unfounded.

Business Basic D&O insurance is a recognised business essential and key colleagues will expect to be covered.

Calculating Costs D&O insurance provides a safeguard against unknown costs which could be catastrophic for you and your business, and it’s much more affordable than you might think.

Liability Exposed Don’t make the mistake of thinking that you’re protected just because you’re running a limited company; the ‘limited liability’ refers to the shareholders and not the directors.

Business Indemnity Insurance can get complicated and it’s easy to assume that your already covered under another liability policy. D&O insurance is often confused with Business Indemnity insurance when they are really two very distinct products. D&O insurance safeguards managers from claims made due to their daily work decisions, whereas Business Indemnity safeguards businesses against claims made for negligent advice or services.

Legal Expenses Another common misunderstanding is that key players will be covered by Legal Expenses insurance. However, Legal Expenses insurance is geared towards defending businesses in cases which are likely to succeed, which explains why cover is typically limited to £100,000. D&O insurance is designed to cover individuals in cases which may well fail and provides for both fees and financial settlements.

Bankruptcy & Insolvency If creditors or stakeholders believe you haven’t acted in their best interests they could take you to court.

Regulatory Investigations Increasing workplace regulation can be complicated for business owners who need to keep on top of everything from Health and Safety and The Environment to Tax Regulation (never mind EU directives and the effect of Brexit); get it wrong and you could end-up in court.

We have access to great deals for all types and size of company from PLCs to SMEs. To find out more visit our D&O insurance page or Tel: 0161 874 8020 to speak with a member of our team.







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