Supervisory Board meeting Allianz SE: Report of the Board of
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Transcript Supervisory Board meeting Allianz SE: Report of the Board of
Directors’ & Officers’ Liability Insurance &
Disclosure of Information
Moscow, November 19th, 2010
Karolina Vogelpohl, Regional Manager Financial Lines CEE
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Agenda
Effects of Information Disclosure
What is Directors’ & Officers’ (D&O) Liability Insurance?
Main Aspects of D&O Insurance
Latest Tendencies
More claims against Directors’ & Officers’ from shareholders
Proposed legislative changes
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Effects of Information Disclosure
Disclosure of information – as a source of
potential errors => misrepresentation
Annual Report = best source of information
disclosure
increase of risk in misrepresentation to the
stake holders
immediate impact on the stock dynamics (if
publicly listed company)
May potentially lead to claims against the
directors (in Russia Chief Accountant &
General Director in particular)
Directors’ & Officers’ Liability Insurance could be viewed as a key risk management tool
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What is Directors’ & Officers’ (D&O)
Liability Insurance?
Directors’ & Officers’ Liability Insurance
covers claims brought against Directors and
Officers of a company, for wrongful acts
committed in the discharge of their duties as
company managers causing financial loss to
the shareholders.
Claimants could be:
-shareholders,
-bondholders,
-company itself,
-employees,
-customers,
-suppliers,
-competitors,
-regulatory bodies and others.
Directors’ & Officers’ Liability Insurance = “Sleep well at night” policy
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Main Aspects of D&O Insurance
Personal liability of company D’s and O’s as individuals (Side A cover),
Reimbursement of the insured company in case it has paid the claim of a third
party on behalf of its managers in order to protect them (Side B or Company
Reimbursement Cover).
Listed stock companies can also obtain cover for claims against the company
itself for a wrongful act in connection with the trading of its securities (Side C or
Securities Entity Cover).
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Latest Tendencies
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Latest Tendencies
More claims against Directors’ & Officers’ from shareholders
Increased claims against Ds & Os claimants looking for “scapegoats”
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Latest Tendencies
Proposed legislative changes including:
changes to Section 71 of the Federal Law on
Joint-Stock Companies № 208-FZ of December
26, 1995 proposing possible indemnification of Ds’
& O’s liability (including defense costs) for
unintentional wrongful acts to be made available
by the company
legislative recognition of companies’ rights to
purchase D&O Liability Insurance
More & More attention being devoted to D&O Liability including legislators
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Latest Tendencies
Proposed legislative changes including:
changes to the Federal Law on the Securities
Market №39-FZ of April 22, 1996 prescribing liability
to the issuer of securities for losses caused to
investors or/and shareholders for wrongful
information reported within the prospectus OR any
other wrongful information disclosure elsewhere
(including annual report)
More & More attention being devoted to D&O Liability including legislators
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Questions or Comments
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Thank you
for your attention!
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