The responsibility of administrators and managers and the D & O insurance in recent years has been producing enlargement and consolidation of the legal regime of the personal responsibility of managers of companies or corporations. While this zeal legislative regulate and guarantee the professionalism and the duties of fidelity, loyalty, diligence and secret of administrators regarding societies that administer may seem very positive in certain cases is occurring, either the increase of wages of the directors or managers to mitigate or compensate for the risk inherent in the profession, either increase the difficulty of integrating into the boards to professionals of greater prestige, especially in instigators sectors or certain companies, which can be considered of special danger. Also, a bad practice of law is causing numerous actions of administrators responsibility.
Faced with this situation, an optimal solution may be to hire a liability policy that covers any possible contingencies arising from the actions of its managers or directors (D & O insurance). In this way, Manager WINS in security and tranquillity in the exercise of their activity, and the company wins also in safety and tranquility, and in addition, in many cases, in cost savings, since it is cheaper to pay the premium of insurance that the increase of the salary of the administrator to increase the attractiveness and attract him or hold him.
Which more claim to the directors and managers are usually: the Board of shareholders, employees, creditors, customers, and, to a lesser extent, administrators/competitors.
The D & O insurance market is a market that is experiencing a slow but steady increase. Therefore, the recruitment of administrators or counselors will go together in the future to the policies of civil liability. The fact that an officer has to respond with their own heritage necessitates the hiring of this type of policy. For this reason, companies will have to offer higher wages and also a few more guarantees that protect these executives.
The cost or premium paid by companies to protect their high charges can range from €600 to much larger quantities, being the average contributions of this type of policy in the market, according to specialized internet portals, around £5,000, taking into account that normally these policies market is sizeable enterprises, although it is true that it is an average, since the risk exposure varies depending on the sector of activity and the type of company. However, the crisis and the increase of the liability of administrators and counselors has not only elevated these insurance but it has extended it to increasingly small and companies belonging to sectors more varied, as public corporations, NGOs and companies in the service sector and leisure, trend that deepen in the coming years.
In any case, the price of a policy cannot be a barrier to hire a counselor or to give you peace of mind in his professional career; cost may not be a deterrent in deciding if the coverage is contracted. In fact, some firms specializing in this type of policy has already seen how some independent directors have begun to hire particular and individual policies to title for coverage of their personal risk. The advantage of this insurance is that the passing of the risk gives security social administrators and managers of the company.
The insurance contract is made by society, which acts as a policyholder, for all of its administrators and high charges. Coverage is specifically given social administrators, Directors General and similar, as they are or may be Deputy Directors, Assistant Directors.
Social managers and personnel directors of the company liability policy protects the personal wealth of social administrators face claims for damages caused to the company, shareholders or to third parties resulting from mismanagement. Typical of this type of insurance coverage tend to be:
-Civil liability for faults, errors or negligence committed in business management, direct financial damages involuntarily caused to third parties.
-Improper employment practices liability (dismissals, discrimination in employment, employment harassment…)
-Expenses and legal costs, that depending on eventual demand against the directors and a conviction could prove enormous amount
-Legal defence of the insured
-Establishment of bail
-Where appropriate, the costs of extrajudicial transactions…
As has evolved the topic of the responsibility of the administrators and managers of corporations can be to develop an economic activity in the legal form of a society no longer implies a total safeguard or impunity, so it does not come from more take into account this type of product.