Liability insurance for senior executives

Liability insurance for senior executives

During the disussions our partners mention numerous times that the management of the company, the role of the company manager has changed significantly, requires not only thorough professional knowledge, but also the skills to solve management problems related to the operation of the company, to maintain legal and regulatory compliance, and as far as development of the company is concerned financial, economic, public procurement and tax knowledge are required. The list could easily be further expanded, but our goal is simply to reduce the pressure resting on the shoulders of company executives as well as diverse expectations and requirements of almost polyhistorical skills.

In such an environment error is almost a natural inherent factor of working, unintentional misconduct that could jeopardize even the operation or solvency of the company by the first person or by a senior executive in charge.

All this became particularly of interest since the introduction of the new Civil Code in 2014 that has brought a very sharp change in the responsibility system. A senior executive can be sued either against his private assets or sued in person nearby his/her company (of course, it is worth thinking not only about legal submissions from outside the company, the damage experience shows that quite a few lawsuits are filed by company owners againsttheir chief executives). In this respect, the amendment of the legislation of Year 2016 did not change much either.

There is a good opportunity to deal with this above-mentioned situation in a reassuring way through the insurance specially developed for this problem. Liability insurance for senior executives provides a wide range of support in the event of the contingency outlined above.

In addition to taking over the payment of any indemnification costs, the insurer will, of course, also support its client during the legal defense, by taking over the costs of the defense and by providing legal advice.

They also guarantee the payment of numerious incidental expenses (so there is an insurer that reimburses the replacement of the company car, or even the cost of psychological care due to the psychological burden caused by the stress involved in the procedure).

In the really wide range of insured events it is worth mentioning two important exceptions (these are equally common to the products of all bidding companies):

– on the one hand, cases of intentional infringement;

– on the other hand, damage discovered before the conclusion of the contract.

Of course, this also means that damages caused before the conclusion of the contract but  have not yet surfaced, are part of the coverage and can even be used for a certain period (usually 1 year) after leaving the current company.