Directors and Officers Insurance

SHC have developed a range of Directors and Officers products that make it more affordable for smaller businesses to purchase this essential protection. Did you know 85% of private companies in the US take out this Insurance whereas the current take up rate in Australia is 5%. As our legal systems are becoming increasingly similar, it is important to understand the risks associated with your role as a Director and Officer and what you can insure against.

So what does Directors and Officers Insurance cover

This policy deals with a number of civil liabilities that directors can incur personally. It covers the directors and their officers against a wrongful act during the period of Insurance in the capacity of their role as a director or officer of the corporation.

Wrongful act can be described as breach of duty, breach of trust, neglect, misleading statement, omission, breach of warranty of authority as an example.

What is excluded from Directors and officers Insurance?

• Fraudulent, dishonest or criminal acts of the particular director or officer, this does not extend to non fraudulent directors or officers.
• Fines and penalties as a rule , but increasingly cover is being provided for some defense costs and some fines, refer extensions – Defense Costs are increasingly being Insurable and even Pecuniary penalties where allowed by the court .
• Known Circumstances, Where circumstances are known at the time of commencement of the policy
• Certain legal jurisdictions are not recognized like US, policy would not respond to a US court decision.
• Losses arising out of bodily Injury or property damage – this is covered by other Insurance, mainly legal liability

Extensions

Increasingly the market are providing broader covers under this class of Insurance.

For more information concerning Directors and Officers Insurance, contact us on 1300 550 665 or email customerservice@shcorp.com.au