Directors' and officers' Liability
Business owners, directors and officers may be held personally liable in many situations.
You can be held liable in respect of your personal assets
Directors' and officers’ liability insurance covers defence costs as well as the pecuniary consequences linked to the liability of a director, de jure or de facto, for any misconduct in the performance of their duties.
It is important to note that this policy covers litigation before both civil and criminal courts.
Cover is automatically acquired for all the company's directors, without the need for them to be listed.
What are the potential claims?
- Harassment / Discrimination in recruitment / Wrongful dismissal
- Claim due to asset shortfall
- Director remuneration policy
- Claim due to failure to supervise an employee
- Claims due to lack of insurance
- Mismanagement / Late publication of accounts / Breach of statutes
10,000+OBLIGATIONS OF THE DIRECTOR
4000DIRECTORS ARE SANCTIONED EACH YEAR AS PART OF A JUDICIAL LIQUIDATION PROCEDURE
27%OF LABOUR DISPUTES CONCERN CASES OF HARASSMENT AND DISCRIMINATION
300 000 €IS THE AMOUNT THAT A DIRECTOR CAN SPEND ON DEFENCE
No legal status protects you in case of a claim as a company director.
HarassmentA SALES TEAM MANAGER IS ACCUSED OF HARASSMENT BY A MEMBER OF THEIR TEAM. FOLLOWING AN INVESTIGATION BY THE LABOUR INSPECTORATE, THE MANAGER IS CLEARED. > AMOUNT OF THE CLAIM: THE INSURER COVERS THE DEFENCE COSTS UP TO €70,000 AND THE COSTS OF PSYCHOLOGICAL SUPPORT FOR THE DIRECTOR DURING THE PROCESS, UP TO €10,000.
Action due to asset shortfall against directorsFOLLOWING THE JUDICIAL LIQUIDATION OF THE COMPANIES OF A GROUP SPECIALISING IN THE PROCESSING AND TRADING OF FABRICS, THE FORMER CHAIRMAN OF THE HOLDING COMPANY WAS ORDERED TO PAY THE SUM OF €1,200,000. THE HIGH COURT FOUND HIM LIABLE FOR THE GROUP'S ASSET SHORTFALL, WHICH AMOUNTED TO €12.6 MILLION, AND ACCUSED HIM OF MISMANAGEMENT OF THE COMPANY AS WELL AS THE LATE DECLARATION OF THE CESSATION OF PAYMENTS. THE INSURER PAID €1,200,000 TOWARDS COMPENSATION ITS POLICYHOLDERS WERE ORDERED TO PAY AND €380,000 FOR THEIR DEFENCE COSTS
If the liability of the shareholders of a single-member limited liability company (EURL in the French acronym) or limited liability company (SARL) is limited to the amount of their contributions, the director, even if they are a shareholder, is liable for their management against their own assets in an unlimited manner.
In the event of judicial liquidation, the courts may hold the directors personally liable for all or part of the company's shortfall in assets if they consider that these directors have been guilty of mismanagement.