If you are a director or an officer of a company, association or foundation, you may face personal liability for the decisions and actions you take as part of your duties. This means that if someone sues you for actual or alleged errors, negligence, breach of duty, misrepresentation or wrongful acts, you could be held responsible for paying damages, legal fees and other costs out of your own pocket. A Dutch D&O insurance is the solution.
This is where Dutch D&O insurance comes in. Dutch D&O insurance is a type of liability insurance that covers directors and officers for claims made against them while serving on a board of directors and/or as an officer. It can also cover the legal fees and other costs that the organization may incur as a result of such a suit.
Dutch D&O insurance can protect you from various types of claims, such as:
- Shareholder lawsuits alleging breach of fiduciary duty, mismanagement, fraud or failure to disclose material information
- Regulatory investigations or actions by authorities such as DNB and AFM
- Employee lawsuits alleging discrimination, harassment, wrongful termination or retaliation
- Creditor lawsuits alleging insolvency, bankruptcy or breach of contract
Please note the exact cover in your specific liability insurance
Dutch D&O insurance can provide three types of coverage:
- Side A coverage covers directors and officers for claims where the organization refuses to or is financially unable to indemnify them. This can happen if the organization has declared bankruptcy or if the claim is deemed to be against the interests of the organization.
- Side B coverage covers the losses of directors and officers when the organization does indemnify them. This can help reimburse the organization for its indemnification obligations.
- Side C coverage covers the losses of the organization itself when it is named as a defendant in a lawsuit along with its directors and officers. This is also known as entity coverage.
The amount and scope of Dutch D&O insurance
The amount and scope of Dutch D&O insurance coverage depends on various factors, such as:
- The size and nature of your organization
- The industry and regulatory environment you operate in
- The level of risk exposure and potential litigation you face
- The limits and deductibles you choose
D&O insurance is not mandatory by law, but it is highly recommended for any organization that has directors and officers who make decisions on behalf of others. A specialist insurer such as Markel can be helpfull. Without Dutch D&O insurance, you could risk losing your personal assets if you are sued for something related to your role as a director or an officer.
D&O insurance can also help attract and retain qualified directors and officers who may otherwise be reluctant to serve due to personal liability concerns. It can also enhance your reputation and credibility with stakeholders such as shareholders, investors, customers, employees and regulators.
If you are interested in learning more about Dutch D&O insurance or getting a quote tailored to your needs, please contact us, one of our trusted partners who specialize in providing comprehensive D&O insurance solutions.