Adequate Directors & Officers Insurance (D&O) or Professional Indemnity (PI) cover is a necessity for all directors and officers, whether executive or non. It is usual for businesses to provide this cover as part of the cost of operation.
However, these days non executive directors often seek their own cover via PI policies of their own, both to supplement business provided D&O cover, and in recognition of their profession being what it is. You do not need to read too many financial publications or even national newspapers to encounter directors in court and thereby highlighting the need for proper, adequate and reliable protection.
Business Link, a division of the UK Government has a helpful section on PI Cover and every insurance business is of course very keen for your business. Liability is a big issue, as witnessed by the wide press coverage of recent events both in the US and UK; it is one that will never go away and must always be considered.
As a professional, you will know the importance of protecting not only your balance sheet but your reputation in the market against the consequence of legal actions arising from your negligence or breach of professional duty or merely allegations of wrong doing. A professional indemnity policy indemnifies the professional against liability for loss caused to others arising from a professional mistake. Some policies are restricted to breaches of professional duty arising through 'negligence' but others are broader and refer to 'any civil liability', subject to certain exclusions. This cover extends beyond negligence to any contractual liability, nuisance, breach of statutory duty, libel and slander, breach of copyright, breach of confidentially and breach of warranty of authority.
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