Directors and Officers Liability Insurance provides protection to directors and officers in a company against claims filed against them personally, due to unlawful acts performed within the framework of their role in the company and causing financial damage to potential plaintiffs.
The list of potential plaintiffs is not a closed list and includes shareholders, employees, investors, suppliers, creditors, customers, competitors, receivers/liquidators, authorities, and more.
We note the professional name for this policy since it is intended also for officers who are not board members, such as managers at all levels, VPs, those reporting directly to the CEO, and so on.
The necessity of Directors and Officers Liability Insurance is significantly high for you against the backdrop of the multitude of personal claims against officers and directors as well as the growing trend of courts in Israel and worldwide to impose direct personal liability on company officers.
From analysis of claims that we perform periodically, it appears that many see officers, even in private companies, as "easy prey."
Without Directors and Officers Liability Insurance, you may find yourself exposed to personal liability claims or "dragged" to courts with enormous legal expenses, all due to decisions you made as part of your role as a manager in the company, even if you acted properly.
Directors and officers liability insurance. As the position size - the size of the risk
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And here one big question arises:
From the introduction, it's already clear that Directors and Officers Liability Insurance is not a standard policy, and the coverage it should provide varies according to many factors and influences: field of occupation, type of position, director's role, definition of responsibility, and more. In accordance with so many variables, the range of claims is also diverse and full of surprises. And then the big question arises - with so many 'unpredictables', how can a directors insurance policy protect you properly? Here are our outstanding advantages:
✔ Experience - Here you need an insurance agency with rich experience in the field that can perform risk analysis and develop a comprehensive list of possible exposures to claims. We approach the formulation of this policy (like any other policy in the construction field - third-party liability insurance, professional liability insurance, construction works insurance, and more) with 30 years of experience in the field. Only this way can you decide which claims you are most exposed to and which extensions are important to add to the basic policy.
✔ Size - The insurance company also performs risk analysis and decides which to exclude from coverage, which reduces your coverage. As a leading agency in construction industry insurance, we have standing with insurance companies and our word has high specific weight. These lead to important advantages on several levels: One - the ability to reduce exclusions and increase extensions. Two - insurance costs, which we can reduce significantly.
✔ Availability - To this word are also added personal accompaniment and professional guidance. These are especially important in directors and officers insurance since we live in a dynamic world, businesses and companies change face, form, and content, and therefore it is recommended to adapt your policy to these changes.
We keep our 'finger on the pulse,' available for any question you have, and for any need - the main thing is that the optimal coverage we've achieved for you will be preserved in the future.
What does directors' insurance protect you from and why is it necessary for you, despite the extensions we made for you to personal liability coverage in the contractors' policy and the professional liability policy?
We have narrowed down and concentrated the long and varied list of claims filed against directors and officers, for which the classic insurance solution is an officers' policy, into a number of key sections below:
✔ Creditors and lenders – who claim failure to meet financial obligations.
✔ Suppliers / customers – due to lack of good faith in negotiations, breach of contract, lack of authority.
✔ Employees – for unlawful dismissal, discrimination, failure to promote, etc.
✔ Government – due to violation of laws/regulations. (For example - environmental laws; see P.O. 4068/07 MI v. Avko Chemicals, labor laws; see the Law to Increase Enforcement of Labor Laws – 5772 – 2011).
✔ Competitors – claiming unfair competition.
And more..
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