Add to the mix high-profile lawsuits and other claims against the top management of Korea First Bank, Peregrine Investments and Sime Darby Pilipinas, and it's easy to understand why some directors are deciding it's better to be safe than sorry. The suit is pending. But times have changed. When a company is bankrupt, its directors' personal assets are often considered the next-best target. Directors should seriously look into taking up a policy to protect themselves.
Charges can range from negligence and breach of duty to wrongful termination and sexual harassment.
Most policies cover all legal fees and any settlement costs incurred in resolving a claim. The cost of a policy depends on the amount of coverage and the nature of the company. Depending on a country's laws, directors may pay a portion of the premium themselves. But the economic crisis has provided a new rationale closer to home, he says. The surge of interest in Hong Kong is less a result of a single event than of an accumulation of cases.