(for Non-Executive Directors). Criminal element deleted and replaced with deliberate, intentional or reckless limitation.

Transcription

1 PrivateEdge Coverage Comparison The policy structure of PrivateEdge (2010) differs from the previous edition. Cover is offered on a modula basis comprising different policy sections with separate and adjustable limits. This allows insureds the flexibility to customize the cover to suit their needs. Alternatively, insureds can maintain an aggregate limit of liability across all sections. Coverage has been expanded significantly. Management Liability Reinstatement Limit OHS Defence & Investigation Costs Insured Person Statutory Liability Public Relations Expenses Extradition Proceedings Asset and Liberty Costs Run-off for Retired Managers and Superannuation Trustees Replaces Special Excess Limit (for Non-Executive Directors). Now up to full Limit of Liability. Criminal element deleted and replaced with deliberate, intentional or reckless limitation. Sub-limit now $100,000. Costs incurred in extradition proceedings. $100,000 sub-limit for counsellor, tax advisor and public relations costs. Bail Bond and Civil Bond Premium paid. Costs arising from proceedings to confiscate or freeze assets, ban, detain or deport a Manager. Unlimited Discovery Period for any Manager and 84 months for any Superannuation Trustee. Reinstatement of limit now available for all of the Policyholder s Board Directors when an Aggregate Limit of Liability applies across all Policy Sections. Previously $500,000 sub-limit. Expansive cover recognizing the increasing use of strict-liability sanctions in corporate, OHS and pollution statutes. Previously $50,000 sub-limit. Affirmative cover. Previously 84 months and limited to Executives only.

2 Superannuation Schemes Complimentary Advice from BusinessGuard Controlling Shareholder Definition Management Liability Definitions Investigation and Investigation Costs Definition Official Body Conduct Manager is extended to include fiduciary capacities concerning superannuation schemes other than employer sponsored schemes covered by the Superannuation Trustees Liability Section. Up to one hour per enquiry for employment law, OHS and general commercial law advice concerning the duties and obligations of a director or officer. A Wrongful Act in both a Manager s and controlling shareholder s capacity, deemed solely Manager capacity. Entity cover removed and inserted in new Corporate Liability Section. Previously limited to preparing for and attending. Now also covers responding to an Investigation, including document production, answering questions and attending interviews. Now commenced upon receipt of written documentation. As well as a regulator, government authority or official trade body, an Investigation may now also be brought by a disciplinary body, criminal authority or other person or body having legal authority to conduct an Investigation. Only applies if dishonest or fraudulent. Deleted references to criminal, wilful or malicious or any intentional or knowing violation of law. For Statutory Liability cover, only applies if deliberate, intentional or reckless. Only applies if formal written admission or final adjudication. Previously covered under Superannuation Trustees (for individuals only). Previous limitation was advice: not involving a significant time commitment. N/A no major shareholder exclusion. Modula format allows separate cover for individuals and the entity. Expansive cover. New broad all-encompassing Definition. The previous criminal element has been deleted recognizing the increasing use of strict-liability sanctions in corporate, OHS and pollution statutes. Previously triggered by written admission or finding by court, tribunal or arbitrator. US/Canada removed. Pollution removed. Professional Services Public Securities Major Shareholder removed. removed. However, Transaction now includes listing any Securities on any exchange or market. removed. Public offering of debt or equity interest in a company to be separately underwritten.

3 Corporate Liability Accidental Death Company Pollution Defence Costs OHS Defence Costs and Investigation Costs Breach of Contract $100,000 sub-limit (and up to $500,000 in the aggregate) for the Accidental Death of a Board Director. $100,000 sub-limit was previously Insured Persons only. $500,000 sub-limit same as previous. $100,000 sub-limit previously excluded. Previously given by endorsement. Separate sub-limit to cover under the for Insured Persons. Liability to Third Parties for Employee Fraud $100,000 sub-limit. Identity Fraud $100,000 sub-limit. Crisis Event $50,000 sub-limit re reputation. Previously $50,000 sub-limit re crisis management services. Superannuation Schemes Complimentary Advice from BusinessGuard Conduct Privacy $250,000 sub-limit operation, administration or sponsorship of a non-employer superannuation scheme. Up to one hour per enquiry for employment law, OHS and general commercial law advice concerning corporate liability. as per Management Liability (other than s199b and non-imputation) Privacy reference removed (previously appeared under Intangible Rights ). Previous limitation was advice: not involving a significant time commitment. US/Canada removed. Public Securities Major Shareholder removed. However, Transaction now includes listing any Securities on any exchange or market. removed. Public offering of debt or equity interest in a company to be separately underwritten.

4 Employment Practices Liability Employment Practice Liability Third Party Liability Complimentary Advice from BusinessGuard Employment-Related Benefits Definition Loss Definition Crime Protection Employee Fraud or Dishonesty Now covers actions brought by any Employee or Insured Person. New for harassment of or discrimination against any natural person third party with $500,000 sub-limit. Up to one hour per enquiry for employment law advice. New definition includes fringe benefits, superannuation contributions, shares, options and incentive or deferred compensation. Loss does not include compensation payable for notice periods, liability or costs of building alterations for disabled employees or educational programs or the reinstatement of an Employee. Principal intent to cause Insured Entity to sustain Direct Financial Loss or obtain a personal financial gain. Previously limited to Employees only. Previous limitation was advice: not involving a significant time commitment. Previously undefined and also included generic term compensation. Previously all compensation was excluded, as was the cost of complying with non-monetary damages or relief. Previously a double trigger with both elements required. Third Party Crime Theft or Fraudulent Act by a Third Party. Destruction and Damage of Money or Negotiable Instruments Care, Custody and Control Shareholders Legal Fees Reconstitution Costs Investigative Specialist Fees Physical loss, damage, destruction or disappearance. Liability for Money, Negotiable Instruments or property belonging to a Third Party. Theft or Fraudulent Acts of shareholders. $50,000 sub-limit for defence of an action resulting directly from a covered Direct Financial Loss. $50,000 sub-limit for costs of rewriting or amending software programs or systems following a covered Direct Financial Loss. $100,000 sub-limit for costs in retaining a fraud investigator to investigate, prove and report a covered or potentially covered Direct Financial Loss. Previously no specified sub-limit.

5 Agent Acts Profit, Loss or Inventory Computation Direct Financial Loss Sustained After Knowledge s: Fire, Forcible and Violent Theft, Premises Damage and Voluntary Exchange or Purchase Carve-out for outsourcing administrative function under contract. Previously, independent contractors excluded. Where an Employee caused or is suspected of having caused a Direct Financial Loss, then inventory records and actual physical count of inventory can be submitted as partial evidence in support of proof of the Direct Financial Loss as required by the Notification Claims Condition. $10,000 threshold now applies to the exclusion concerning knowledge of an Employee s dishonest or fraudulent acts prior to employment with the Insured Entity. Limitations re new cover features. Not included. No previous threshold. New exclusions go with new cover. Superannuation Trustees Liability Insured Entity Reimbursement Exoneration Reimbursement of indemnification of Superannuation Trustees. Liability attaching to a Plan upon the Exoneration of a Superannuation Trustee. Insured Entity Liability Claims against an Insured Entity. Ombudsman and Superannuation Regulator Awards Manager s also apply to Superannuation Trustee Loss of Documents Complimentary Advice from BusinessGuard ERISA Failure to Fund a Plan A finding by an Official Body is now covered. Previously - only damages for a judgment entered against an Insured. See Management Liability Section. $100,000 sub-limit for the cost of replacing or restoring documents. Up to one hour per enquiry for superannuation law and trustee liability advice. Specific limitation concerning Employee Retirement Income Security Act 1974 (US). Limitation concerning funding failure or failure to collect contributions. Previous limitation was advice: not involving a significant time commitment. Previous generic trustee exclusion removed. New exclusion goes with new entity cover.

6 Statutory Liability Insured Person Statutory Liability Insured Entity Statutory Liability Criminal element deleted and replaced with deliberate, intentional or reckless limitation. Fine or pecuniary penalty arising from Corporate Liability, Employment Practices Liability or Superannuation Trustees Liability. s: deliberate, intentional or reckless conduct, anti-competitive practices, ERISA, violations of some sections of the Corporations Act, personal liability, professional services, Tax and Traffic. Expansive cover recognizing the increasing use of strict-liability sanctions in corporate, OHS and pollution statutes. New feature previously limited to OHS and Pollution only. New exclusions go with new cover. General Terms & Conditions Aggregate Limit of Liability Court Attendance Regulatory Crisis Response Discovery Emergency Costs Legal Expenses Policy New Subsidiary Separate limits are now offered for each Policy Section. $100,000 sub-limit for per-day payments for court attendance by Insured Persons. $100,000 sub-limit for costs of responding to a regulatory raid on on-site visit. Automatic 60 day period. Right to purchase 24 month period at 150% of full annual premium. As well as prior Wrongful Acts, also includes matters which occurred or arose prior to the expiry of the policy period for an investigation, extradition proceeding or assets and liberty proceeding. Retrospective approval (up to 10% of the limit of liability) if consent can not reasonably be obtained. If a legal expenses policy is purchased alongside this policy, cover under this policy is still available on a primary basis. Generic language capacity to determine the outcome of decisions about the financial and operating policies replaced with accounting standards subsidiary definition. Revenue threshold removed, but US/ SEC/territorial limitation added. The Policyholder can now purchase separate limits to ensure that a loss from one policy Section does not dilute or exhaust the limit of another Section. New feature recognizing potential for OHS and other regulatory raids and on-site visits. Previously 30 day period. Expansive cover. New cover feature management liability policies generally apply excess over other insurance. Generally accepted subsidiary definition gives certainty of outcome.

7 Defence Costs Definition Employee Definition Loss Definition Outside Entity Director Definition Transaction Definition Defence and Settlement Claims Condition BusinessGuard Retention Waiver Condition Non-Avoidance Several Nature of the Policy Now includes costs of experts to prepare an evaluation, report, assessment, diagnosis or rebuttal of evidence in respect of a Claim. Now includes independent contractors and secondees under the direction and supervision of the Company where such persons are indemnified by the Company as if Employees. Crime Protection now applies to fraud and dishonesty of employees of outsourcing companies and Superannuation Trustees. Now includes: pre- and postjudgment interest, and multiple portion of multiple damages. All entities other than a subsidiary; US incorporated or domiciled entity; financial institution; public listed entities are automatically deemed outside entities. A Transaction will no longer be triggered by receivership, bankruptcy, liquidation, administration or insolvency. The Insured now have the duty and obligation to defend and contest any Claim. However, the Insured can elect to have AIG do this for them. Either way, insureds have access to AIG s expertise and case management experience. Pre- agreed panel rates allow defence to proceed without delay. Waiver or refund of the Retention upon exoneration from liability. Not avoidable or rescindable in whole or in part. but right to reduce liability under the Insurance Contracts Act 1984 s.28(3) for fraudulent misrepresentation or fraudulent non-disclosure. Policy covers each Insured for their own individual interest. No statements, acts, errors or omissions, info or knowledge imputed for the purpose of determining whether any individual is covered under the policy. Affirmative cover. New/expanded cover feature. Expanded cover recognising the executive team may be required to assist an insolvency office holder in any winding-down or administration of the Company. This offers flexibility depending on the insured s resources and the degree of involvement sought by the insured in claims handling. Previously a requirement to agree the member firm s rates and other terms of engagement are reasonable. New feature no application to Crime Protection Section. New feature no application to Crime Protection Section.

8 Head Office Sydney Level 19, 2 Park Street Sydney NSW 2000 Australia GPO Box 9933 Sydney NSW 2001 Australia Melbourne GPO Box 9933 Melbourne VIC 3001 Australia Brisbane GPO Box 9933 Brisbane QLD 4001 Australia Perth GPO Box 9933 Perth WA 6848 Australia Australia wide T F International T F This product is issued by AIG Australia Limited (AIG) ABN AFSL The description of coverage contained in this document is a summary and for your information only and should not be treated as advice. The coverage described and any claims made are subject to terms, conditions, limitations and exclusions outlined in the policy of insurance. Availability of coverage and the terms and conditions thereof are subject to underwriting assessment, the location of the applicant and/or regulatory approval. Any claims examples stated herein (if any) are purely fictional and are for illustrative purposes only. They should not be construed as any comment on, or confirmation or extension of, coverage for any past, present or future claim. In the event of any conflict between the descriptions of coverage in this document and the policy of insurance, the provisions contained in the policy of insurance will govern. This document is accurate as at September Copyright ME10/