Do I need Company Director’s insurance?

By Simon O’ Connor, 14th March 2016

Although not a legal requirement, director’s insurance is strongly advised. It is often the case that a company director/owner will put the needs of their suppliers, employees and customers before their own. This can cause major trouble for them down the line should they become unfit to work, receive a personal claim against them or be unfortunate enough to lose a key person to the company due to illness or death.

The majority of directors/owners will ensure that they have arranged insurance cover for their assets such as their machines, Premises and stock. They would also ensure they have arranged Public or Employers Liability yet quite a few will trade without covering themselves.

Below are three insurance policies which we suggest every company owner/director consider:

Income Protection

An income protection policy pays a benefit to the policyholder if they are incapable of working due to sickness, accident or an injury. Usually the benefit is paid after a few weeks of absence from work and continues until the policyholder is fit to return to work or until the date which the policyholder is due to retire.

It is often the case that most company owners/directors who have been injured in the workplace will not be granted employer’s liability claim as they are usually the one who is responsible for health and safety within the business.

An Income Protection Policy guarantees a pre-arranged income for the company director/owner should they become ineligible to work due to an injury, sickness or an accident sickness whether it was work related or not.

Directors and Officers Liability

Directors and Officers Liability insurance provides cover should personal action be taken against Directors or Officers by numerous parties including shareholders, customers, regulatory bodies and competitors.

This type of insurance policy has become even more important since the introduction of the Companies Act 2014 in June last year. The Act places greater responsibility on the company directors and also features a range of enforcements that can be taken for breach of the Act. This includes the possibility of a company director being personally sued.

Key Person Insurance

Management expertise, experience and contacts are often the most important assets of the business. How would your company cope if the key person were to pass away prematurely or be unable to work due to illness?

Key person Insurance is an important policy that can be taken out by the company on certain key individuals. The benefits are paid to the company who can then use it as they see fit. This includes paying the costs of temporary staff and fund increased salary of new staff.

For more information on any of the above insurance policies please do not hesitate to contact Company Bureau on +3531 646 1625 or fill out a contact form on our website and we will be back in touch as soon as possible.