These guarantees protect the entrepreneur or executive from claims that may be made against them in the normal course of their work, which basically involves decision-making. Those people who have to make decisions on a daily basis can make errors which may cause damages to third parties. Logically, the latter are entitled to make a claim, and this may seriously affect the personal assets of the executive or entrepreneur, the company and its entire setting.

Protection for the insured party:

We also offer a specific insurance policy for the Civil Liability of Directors and Officers (known as Directors & Officers: D&O) to cover founded and unfounded claims received by natural persons owing to decisions they have made in the management and governance of the company and which  may result in financial damage to third parties.

The D&O insurance policy is different from the company's General or Professional Civil Liability policy, as the latter covers claims which are caused to third parties through material, bodily  or  financial damages, in the operational/professional setting of the business.

The D&O policy basically covers three "financial contingencies"  that affect the Insured Party's Personal Property:

> Legal and extrajudicial  defence expenses and legal costs: with free selection of Lawyers; bond posting and expenses are also covered, expenses which, owing to their complexity, are usually very high and are generated regardless of the final legal ruling.

> Compensation for damages to third parties.

> Image  restoration  expenses. 

There are also other complementary guarantees, including:

> Claims related with employment practices: bullying, sexual harassment, disputes arising from dismissals, etc.

> Criminal defence expenses for the company (penal code reform, Law 2/2010 Art. 31 bis).

> Defence expenses for the contamination of material assets or persons as well as pure financial damages.

Potential claimants include:

Shareholders: minority or majority / individually or through a corporate liability action

Employees or even candidates for a post

Creditors (Suppliers, Financial/banking institutions, etc.)

Clients

Competitors

Administrative/Public Bodies: E.g. Tax Agency, Spanish Securities & Exchange Commission (CNMV), etc.

Liquidators (in the liquidation phase of bankruptcy proceedings)

Purchases / Investors

The Company itself through a Corporate Liability Action 

Any Third Party 

Process to be followed to take out the policy:

In order to provide you with a guideline quote, we only need the general details (company name and Tax ID Code), activity and estimated annual turnover of your company.

Additionally, in order for you to take out the policy, we may also require the Balance Sheet and Income Statement for the most recent financial year, and you may need to fill out a brief questionnaire.

Recently, the permanent modification to company, environmental, employment, competition and tax laws, among others, has meant that Directors and Officers  have to deal with an increasing number of potential claimants. 

With regard to the number of claims registered over the last eight years, our experience at Ferrer&Ojeda is as follows: (with compensation payments, without counting legal expenses, of €585,000)

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