Tag archives: D&O

D & O insurance and reflective loss claims

At common law when a wrong is done to a company only the company can sue for the damage caused to it. That does not mean that the shareholders of the company may not consequentially suffer any loss (what is known as a reflective loss). Any negative impact the wrongdoing has on the company is … Continue reading

Rising tide for directors

State capture, growing public discontent fuelled by social media at the activities of private companies and the need for ethical business practices all present significant implications for directors and for insurers who provide directors and officers liability insurance. Increased scrutiny by regulators and industry watchdogs into the affairs of companies and the conduct of their … Continue reading

Directors and officers policy does not cover executive-induced decline of company (US)

A California company specialising in plumbing fixtures unsuccessfully sought cover under a directors and officers policy for a claim brought by three former directors based on the decline of the business because of the chief executive’s erratic behaviour. The court held that the so-called ‘insured-v-insured’ exclusion unambiguously bars coverage for a claim such as that … Continue reading

Is anti-competitive behaviour insurable?

The August 2016 first-of-its-kind judgment against South African Airways in favour of Nationwide Airlines, for damages arising from conduct that was held to be an anti-competitive exclusionary act preventing Nationwide from entering into or expanding within the travel market, raises the interesting question whether the loss is insurable by the company and the directors. SAA … Continue reading

D&O policy voided for non-disclosure

In the USA a directors and officers policy issued to a man who later pleaded guilty to selling $1.9 million in phony stock was voided for non-disclosure. The policy taken out and renewed included a policy application where the director stated he was unaware of any acts, errors or omissions that may be grounds for future … Continue reading
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