Marsh’s London office announced that it has launched a new Directors’ and Officers’ (D&O) liability diagnostic tool for private companies domiciled in the UK. “The service is free to clients with assets below £250 million ($413 million). The tool measures the effectiveness and capability of the D&O policy that a company has in place.”
The new diagnostic tool was developed by Marsh’s Financial and Professional (FINPRO) Practice in London. It “quantitatively rates different areas of coverage afforded under a client’s existing D&O policy against a pre-ranked, ordered by importance, group of considerations and factors appropriate to the threats facing the boardroom,” said Marsh.
The tool examines some of the following areas:
— Exclusions that completely negate the effectiveness of the coverage
— Whether cover is available to all who may require protection
— Clearly identifying restrictive language
— Whether in the event of an acquisition of the company, the policy will offer full protection for prior acts
Andrew Jackson, Managing Director in Marsh’s FINPRO National Practice commented: “Risk and the economy are exponentially linked. As the performance of companies weakens in a recession, the risk of legal and regulatory actions against directors tends to increase. Traditionally, many directors have relied upon indemnities given by their companies in order to protect them and their personal wealth. However, if a company becomes insolvent — an increasing risk in the current economic climate — these indemnities may be virtually worthless.
“The uncertainty of the ability of indemnities to provide protection, and the fact that not all D&O insurance policies are the same, led Marsh to develop this tool. There are many sub-standard policies which have been purchased as an ‘off the shelf’ product and historically renewed, which are not offering the protection that directors and officers need in these uncertain times. Marsh’s new tool will help clients ensure that their D&O policies are fit for purpose and provide the protection their directors need in today’s climate.”
Source: Marsh – www.mmc.com or www.marsh.com
Topics New Markets Medical Professional Liability Directors Officers
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