Article sponsored by Intact Insurance
Wrongful dismissal, unpaid wages, unfair competition, defamation: these are some examples of allegations that can result in a lawsuit being brought against a company’s directors and officers. Many board members and executives believe that if their company were sued, their personal liability would be limited and their private assets would be untouchable. Not so! A lawsuit could put their own financial security at risk, and various legislation has created increasingly onerous obligations for directors and officers.
Help keep your customers safe from possible litigation by providing them with coverage suited to the risks that come with their responsibilities. A lawsuit, even one that’s completely unfounded, can result in significant legal fees for the defence. But with the right insurance, your clients who are executives or board members will be protected against suits alleging wrongful acts, including:
- negligence, misconduct, errors and omissions;
- breach of duty;
- misleading statements; or
- any other act covered by the policy that could be held against them in their capacity as a director or officer.
Myth and reality: arguments to convince your customers
It can be hard to convince your customers they need protection against these risks.
Here are some solid arguments to counter the objections they might raise.
WHAT THE CLIENT THINKS
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What they need to know
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My liability is limited; they can’t come after my personal assets.
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- That’s not true. A director’ s personal assets can be targeted in a suit.
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My business is too small; I don’t need this coverage.
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- Liability is the same for any business or association, large or small
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I rarely attend the corporation’s board meetings.
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- It doesn’t matter. Your customer can be sued just like any other board member.
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Lawsuits are often totally without merit.
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- That may be so, but if your client does not mount a defence, a court could make a ruling and award damages against them court.
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The Intact Insurance team
