Directors & Officers Circumstances & Claims

Claims on Directors & Officers Liability Insurance

Prompt Reporting

It is important that your insurers are notified as soon as you become aware of a claim or circumstances that might result in a claim.

The Benefits of Prompt Reporting include:

  • Insurers can immediately appoint solicitors to record relevant information which may be forgotten by the time a claim is made.
  • The claim can be managed by your insurers and their solicitors who are experienced in dealing with such matters.
  • Your business can continue with the minimum amount of disruption caused by the claim.
  • The matter may be resolved by the insured and the insurers before it proceeds to legal action.

Normal Practice

You must provide all necessary assistance to your insurers in the event of a claim.

You must never admit liability, settle a claim or incur any costs in with the claim without the written consent of your insurers. Your insurers are entitled at any time to take over and conduct the defence or settlement of any claim in your name.

For a full understanding of Directors' and Officers' liability insurance it is vital that the policy wording be examined and discussed with your advisers. This summary is not a definitive analysis of the insurance coverage and is given for general information purposes only.

Latest News

Illegal or unsuitable cladding now a big issue

Why we have laws, regulations and Australian standards? Because some people just do the wrong thing all for the sake of making money. The cladding issue is the subject of 4 Corners program on the ABC.

We are already seeing Insurance policies now placing exclusion endorsements into their policies excluding and claims relating to illegal cladding. We are seeing Governments demanding Audits of all existing buildings above a certain height. There are accusations of Builders taking other short cuts such as on Wiring, Pipes and sprinkler systems. 

The question is, who is to blame? Who will take responsibility?

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Small business in NSW

Right after the NSW Government have reimposed Fire Service Levies, they have at least made an effort for small business. The government has announced it will abolish stamp duty on a number of policies taken out by a small business. This is an important change.

What is a small business? In order to gain the exemptions, the business must be a small business for Capital Gains Tax Purposes for the income year in which the insurance is effected or renewed. A small business for CGT purposes is: “an individual, partnership, company or trust that is carrying on a business, and has an aggregated turnover of less than $2 million.”

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