Directors & Officers Liability Insurance (often called D&O) provides protection for the directors and officers of a company and can be extended to include the business (the entity) itself in respect of a legal action brought for alleged wrongful acts in their capacity as directors and officers.

An appointment to an executive or non-executive director position brings not only prestige, but also potential personal liability. For this reason we recommend that for the protection of all directors and officers of the company, businesses should consider insuring against the potential risks and resultant legal actions.

As a Director, you can be held responsible for actual or alleged breach of duty, neglect, errors or omissions. If accused of breaching your duties, actions may be brought against you personally, with significant consequences.

In the current regulatory climate, there is increasing focus on the affairs of companies and their officials. Mistakes certainly do happen in the course of managing a business that can adversely impact shareholders, employees, creditors, customers, suppliers and other interested parties. We have seen the route to litigation in the UK become very accessible in recent years and for this reason we recommend such insurance protection as the policy includes defence costs.

The environment in which companies operate is constantly evolving and it is imperative that company directors and officers identify and manage the risks around them and protect themselves with appropriate insurance.