Why Directors and Officers Cover Is Essential For Mergers Acquisitions and Insolvency

It’s no surprise in the current economic climate that there is a flurry of mergers, acquisitions and insolvencies. As the recession shows no signs of disappearing any time soon, it is worthwhile re-iterating the fact that where these events occur, directors and officers of the companies concerned face potential exposure to claims for alleged breach of their professional duties.

Directors and Officers Insurance provides cover for Directors and Officers of a company (including subsidiary companies) against liability for alleged or actual wrongful acts committed when exercising their duties. In the event of an insolvency there could be claims made alleging that the directors traded the company at a time when they were aware or ought to have been aware that the company could not meet it’s debts.

Equally, if you consider the complexities involved in the merger of two or more companies, or the acquisition of one company by another, the Directors can be left exposed to action by an aggrieved party to that transaction. Again, we’ve included an example claim on the claims page regarding this type of activity.

Cover against these situations can be purchased quickly and easily so call us if you need advice or you can get a quote online.