Directors and Officers are held personally responsible for sound implementing corporate procedures and for monitoring management's implementation of such procedures. This can include day to day decisions such as sound investment management, release of non-public information, conflicts of interest, corporate policies regarding discrimination, sexual harassment, operating in cross-border jurisdictional activities, hiring and firing decisions, benefit plans, merger and acquisition activity just to name a few. Due to these exposures, a cover seems to be highly recommendable.

If you don't have good D&O insurance in place, you won't be able to attract or keep independent directors to your board. The people you bring in to help advise you on growing your business don't need or want the threat of a lawsuit hanging over their heads should something go wrong. According to the results of a Corporate Board Member study undertaken in November 2002, 48% of existing board members turned down a board position because the risk was too great. And 49% say D&O insurance was a very important factor in their decision.

D&O Insurances are of crucial importance not only for the directors but also for the company and its shareholders because this insurance enables their directors to act without avoiding to operate in countries where they would face big personal risks.

As you can see, you are not required to always make the right decisions for your company, only to make your decisions in the right way.

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