Directors, commissioners, and supervisors can be held personally liable with their private assets for mismanagement, improper governance, or an unlawful act. This can be done by individuals within or outside the organisation, such as shareholders or - in the event of bankruptcy - a curator.

Directors can insure themselves against these types of claims. This has seen a significant increase in the past 25 years. While in the past mainly large corporations protected themselves, nowadays more and more SMEs and non-profit organizations have liability insurance.

As premiums are starting to rise again after years of decline, now is a good time to carefully assess your risk and/or policy. There are now more than twenty insurers offering directors' liability insurance, and we are happy to help you find the most suitable one.

What is insured?

Broad claim description.
In addition to a claim for compensation, entitlement should also be understood to include civil proceedings, criminal proceedings, extradition proceedings and proceedings of an administratie nature.
Coverage for investigation expenses, made by the Enterprise Chamber.
Broad definition of damages definition
So also legal interests, costs of the other party for which an insured persion is held liable, compensation after arbitration and settlement.
Automatic coverage for new directors and new participations.
Broad Extended Reporting Period, even after bankruptcy or merger and acquisition, with a pre-determined permium.
Free Extended Reporting Period for retired directors, supervisory directors and supervisors.
No early termination option by the insurer after a claim or change in risk.
Most insurers provide worldwide cover, excluding the US and Canada. Cover for the US and Canada must be specifically requisted and few insurers can provide coverage for this.
Insurers today check whether management is taking sufficient measures to prevent or manage cyber risks and GDPR incidents. Including insuring for damage caused by a hack, loss of data or personal data, or the consquences of ransomware. Ignoring these risks can lead to directors' liability and some insurers subsequently exclude claims related to cyber damage.
Most claims come from the insolvency pactitioner, which is why it is important not to have a bankruptcy exclusion in the policy, or an exclusion of coverage in case of negative equity.
Courts usually assume a minimum of coverage of € 5.000.000.

* Extended Reporting Period
Claims reported after the end date of the policy are, in principle, not covered. But sometimes you only get a claim after the insured period has expired, for instance in case of bankruptcy. Tail coverage then offers a solution. This is offered by different insurers in different forms.

What is not insured?

Intentionally caused damage. This does not apply to directors or supervisors who were not or could not have been aware of this
Fines or penalties imposed
Claims brought in the United States and/or Canada (or based on the law of those countries). In some cases, we have cover for this exclusion!
Claims covered under Corporate, Professional, or Environmental Liability Insurance

For whom?

For directors, supervisory directors or supervisors of companies (BV or NV), Cooperatives, Associations and Foundations

Premium indication

Annual premiums from €350, not including 21% Insurance Tax. We can send a quote within 1 day, selecting the best offer from 10 insurers. All insurers are specialised in your field and among the best in the business.

FAQ's

My company is being held liable. What now?

As soon as you are found liable, you should report it to us. We advise you not to admit liability immediately, but to submit it to the insurer first.

Is a Directors Liability insurance mandatory?

No, not mandatory. But as a director, you should think carefully about the possible concequences of decisions for which you can be held

(co)-responsible, and what this could mean for your private assets and situation.

Je bent niet verplicht om bepaalde contractvoorwaarden te hanteren. Afwijken hiervan of het accepteren van leveringsvoorwaarden van opdrachtgevers is geen probleem. Je hoeft ons dit niet ter goedkeuring voor te leggen. Wij adviseren echter wel zoveel mogelijk de algemene voorwaarden van toepassing te verklaren, omdat het jouw aansprakelijkheid naar derden beperkt.

Does this insurance provide cover in the US and Canada?

No. Claims filed in the United States and/or Canada (or based on the law of these countries) are excluded. Insurers do not provide this coverage as standard because the damage amounts and legal assistance there are much higher than here. In some cases, we have coverage for this exclusion and can provide coverage for this jurisdiction as well.

What does Prior Acts Coverage and Extended Reporting Period mean?

Prior Acts Coverage

This is damage whose cause predates the start of the insurance, but is discovered during the policy period. This so-called retroactive cover is not covered by default, but can sometimes be purchased for an additional period. This allows you to insure yourself against damages that are not yet known, but could potentially arise.

Extended Reporting Period (ERP)

The opposite of Prior Acts Coverage: damage that manifests after the insured period has expired, but whose cause falls within that period. Again, you can insure against this ERP cover for a number of years. This is often offered by insurers after termination.

Does Blue Risk advise on other insurances?

Absolutely. We are specialists in complex risks, but are happy to help you protect agains some of the more mundane corporate risks. Think of corporate insurance for buildings, inventory, transport, business damage, accidents, corporate travel and employee insurance.

We don't advise on pension and other life insurances.

Is there cover for other board members when they are not aware of fraud by the financial officer?

Yes. If they are not aware of this fraude, they do have coverage and do not fall under the intent exclusion.

Er zijn verzekeraars die dit dekken, maar niet allemaal. Kijk dus goed naar de verschillen.

De hoedanigheid geeft aan wat voor soort activiteiten je verricht. De verzekeraar schat hierop het risico in en zou werkzaamheden kunnen uitsluiten bij een schade als ze hiervan niet op de hoogte waren. Het is heel belangrijk dat de verzekerde hoedanigheid zo is omschreven sat alle activiteiten eronder vallen. Maak de omschrijving zo ruim mogelijk en controleer elk jaar of deze nog klopt.