Understanding The Signature Management Liability Insurance
Till recently, the Indian corporate sector had been relatively immune from the liabilities of directors and officers. But with globalized business environment, rising consumer awareness and adoption of International business practices, liabilities of corporate directors and officers are becoming a potential threat looming over the Indian corporate sector. Apart from the operational and financial risks, businesses are also exposed to professional risks arising due to acts of directors and officers. Liabilities could arise due to a number of reasons – intentional or unintentional, expected or unexpected, conflict of interests, or they could arise purely due to an error of judgment.
Investors and the members of the board of directors would not want to risk their personal assets to serve as a corporate director or officer without directors and officers’ insurance coverage.
Signature Management Liability Insurance Covers:
The Signature management liability insurance in general covers the administrative, civil, regulatory and extradition proceedings based on the actual or alleged act, errors, omissions, misstatements, neglect, or breach of duty committed or allegedly committed by a director or officer.
Who is Covered?
- All Directors (past, present & future)
- All Officers (employed in an executive capacity)
- Employees performing managerial or supervisory roles
- Company Secretaries
- Spouse, Legal Heirs & Representatives
Scope of Cover:
- Directors and Officers’ Liability Coverage
- Company Reimbursement Coverage
- Securities Coverage
- Legal Representation Expenses – Directors and Officers
- Legal Representation Expenses – Company Reimbursement
Extensions Under the Signature Management Liability Insurance:
- Advancement of Costs & Expenses
- Covers D&O claims with respect to Outside Directorship
- Covers Civil Fines & Penalties
- Occupational Health & Safety, Corporate Manslaughter – pay for defense cost, civil fines & penalties, prosecution & reputation protection cost & crisis expenses
- Dedicated Additional Limit of Liability for Directors & Officers
- Bilateral Extended Reporting Period- For 90 days (No additional premium payable)
- For 365 days (Upon payment of additional premium)
- Retired Directors & Officer- Extended Reporting Period of 7 years
- Emergency Costs & Expenses – For a period of 30 days
- Crises Expenses –Additional limit and does not reduce, the limits of liability
- Prosecution & Reputation Protection Costs – Sub-limit
- Covers Insured Person Tax Liability
Key Exclusions:
- Pending or prior litigation, demands or judgments
- Circumstances notified under a prior insurance policy
- Bodily injury or property damage claims
- Any USA claims brought by any organization or any outside entity, if arises out of an outside Directorship
- Deliberately fraudulent act or omission or any willful violation or breach of any law by an Insured Person
- Deliberately fraudulent act or omission or any willful violation or breach of any law by an organization
