The U.K.-based ACE European Group, a primary underwriter of directors and officers insurance in the London market, issued a statement that it is “taking a lead in the D&O market by providing greater clarity in the extent of cover relating to extradition. ”
ACE noted that “recent publicity surrounding extradition of directors from UK companies to the US has created confusion about the scope of D&O cover. Buyers and brokers appear unsure as to whether or not the costs of defending and appealing extradition proceedings are covered. The issue is unlikely to go away as there is a likelihood of further extradition proceedings, for example in relation to price fixing.”
Joe Fernandez, D&O Product Manager for ACE, stated: “Our D&O policy wording has always catered for the defense and appeal costs associated with extradition proceedings. It’s important that the market avoids making the matter more complicated by continually debating whether D&O will provide protection in these circumstances. In our view it does, and directors should not be left feeling confused.”
ACE said that in order to “clarify this, and as a response to inquiries from brokers, ACE has issued a policy endorsement which clearly and explicitly states that extradition proceedings are included in order to remove any uncertainty.”
Fernandez continued: “The impact of the Nat West three case has caused a lot of concern amongst those involved in the D&O market. The fundamentals of the cover are to provide directors with peace of mind that their liabilities are covered. Our D&O policy offers an extensive range of protection and we believe that the costs relating to defending and appealing extradition proceedings should constitute a valid claim.”
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