Liability Cover on the rise

The Clause 49 of the listing agreement mentions that the listed companies should have atleast 50% of the board comprising of independent directors. Complying with this clause, many Companies are expected to buy this cover. The directors and the officers are at a stake of being dragged to the court by authorities for any of their wrong doing. Directors' and Officers' liability insurance (D&O) offers the individual directors and officers the protection they need from personal liability and financial loss arising out of wrongful acts committed or allegedly committed in their capacity as corporate officers and/or directors. Liability cover serves the purpose when the company suffers losses. Following these lines, HDFC Chubb General Insurance will offer liability insurance business with a product for mid-sized companies. The policy will offer cover for six risks within a single limit under its new product called Forefront Portfolio. The risks include directors' and officers' liability, outside (independent) directors, employment practices, trustees, internet and employee theft. Howden of UK, which specializes in liability insurance, has started in India as 'Howden India'. It will be soon introducing its venture capital and Private Equity Fund Manager's Liability Insurance Programme.