Directors’ and Officers’ Insurance in the UK

Mukwiri, Jonathan

Abstract

This paper examines the significance of the directors’ and officers’ (D&O) insurance policies in the UK. It argues that the significance of D&O policies lies in D&O policies being commercial than legal tools for directors. When third parties sue a director, unless the director assumes personal responsibility (where this assumption is an element of the civil wrong), English law does not impose personal liability against the director, and a D&O policy, as a legal tool, may not respond. Moreover, as a legal tool, it may not be necessary, as defence costs can be provided to directors under company indemnity. As commercial tools, D&O policies provide directors with defence and investigation costs, and in criminal cases defence costs until the final judgment or admission of dishonest conduct. Moreover, as a commercial tool, unlike under company indemnity where directors would repay defence costs if unsuccessful, defence costs will usually be covered off by a D&O policy in the event of a negative judgment.

Citation

Mukwiri, J. (2017). Directors’ and Officers’ Insurance in the UK. European Business Law Review, 28(4), 547-573

• Journal Article Type: Article
• Acceptance Date: Apr 27, 2017
• Online Publication Date: Sep 28, 2017
• Publication Date: Aug 1, 2017
• Deposit Date: May 17, 2017
• Publicly Available Date: Nov 30, 2017
• Journal: European Business Law Review
• Print ISSN: 0959-6941
• Publisher: Kluwer Law International
• Peer Reviewed: Peer Reviewed
• Volume: 28
• Issue: 4
• Pages: 547-573
• Public URL: https://durham-repository.worktribe.com/output/1358915
• Publisher URL: http://www.kluwerlawonline.com/abstract.php?area=Journals&id=EULR2017027