Directors and officers in all types of corporations are exposed to different claims during their service in corporate positions. Many duties prescribed by law apply to Directors and officers: duty of care, fiduciary duties and specific duties such as prohibition on conflict of interests, non-competition with the company, publication of prospectus in public companies and more.
These obligations might expose the Directors and Officers to a personal claim arising out of the routine management of the corporate position as well as specific events in different kinds of claim. Starting from misrepresentation of notices to the stock exchange or failure to publish profit warning and up to claims related to labor relations, investigations and more.
The duties of Directors and Officers relate to a wide variety of potential claimants, including the corporation itself, shareholders, employees, suppliers, clients, neighboring businesses and individuals, banks and credit providers, Israel Securities Authority, income tax authorities, Ministry of Environmental Protection, Controller of Restrictive Business Practices and many other entities.
Directors and officers liability insurance policy provides its insureds full personal protection as required in the Companies Law regarding the following risks, provided however that the Director /officer acted in good faith and there were reasonable grounds to assume that the action would not be injurious to the company’s benefit or any other person (third party):
1. Breach of the duty of care towards the company or any other person.
2. Breach of fiduciary duties towards the company.
3. Financial liability imposed on the Director or Officer in favor of another person
Nilibit specializes in D&O liability insurance since 1994 and provides its clients a wide and dynamic insurance coverage that is updated according to the changes in the Companies Law and the changes in the liability of Directors and officers that derive therefrom.
Nilibit tailors insurance coverage in an individual manner to the client’s needs, including exceptional coverage such as unique coverage for prospectus, insurance for long terms and improved coverage for employment-related claims brought by employees and, in certain circumstances, specified third-parties.
As of today Nilibit provides Directors and Officers in hundreds of organizations, including private companies, public companies traded in Israel, public companies traded in foreign stock exchanges, government companies, pension funds, nonprofit organizations, associations, venture capital funds, business incubators and more. Furthermore, Nilibit has unique capabilities in accompanying start-up companies, starting with the basic stages, through capital raising and ending with issue, merger or another exit.