SOE directors’ insurance proposal rejected
Directors serving on boards of state-owned enterprises have been urged to take out liability insurance at their own cost.
OGONE TLHAGE
WINDHOEK
Public enterprises minister Leon Jooste has told directors serving on boards of state-owned enterprises (SOEs) that government will not provide them with indemnity and that they will have to take out liability insurance at own cost.
The insurance protects the personal assets of a company's directors and officers as well as that of the company itself in instances where civil claims may be sought against the company.
The cover also provides reimbursement to the company when indemnifying its directors and officers. Directors’ liability insurance pays for legal defence costs, settlements and awards when defending directors and officers from a valid claim, according to the Institute of Directors.
Rejected
“The ministry fully shares and supports the view that it is important for board directors to be insured in the execution of their fiduciary duties and it is advisable that they take out directors’ liability insurance cover,” Jooste said.
According to the minister, legally and procedurally, government is not allowed to provide indemnity to the boards it had appointed.
“The shareholder cannot grant such requests and individual board members are hereby encouraged to take out their own insurance, which is readily available at a nominal fee,” he said.
WINDHOEK
Public enterprises minister Leon Jooste has told directors serving on boards of state-owned enterprises (SOEs) that government will not provide them with indemnity and that they will have to take out liability insurance at own cost.
The insurance protects the personal assets of a company's directors and officers as well as that of the company itself in instances where civil claims may be sought against the company.
The cover also provides reimbursement to the company when indemnifying its directors and officers. Directors’ liability insurance pays for legal defence costs, settlements and awards when defending directors and officers from a valid claim, according to the Institute of Directors.
Rejected
“The ministry fully shares and supports the view that it is important for board directors to be insured in the execution of their fiduciary duties and it is advisable that they take out directors’ liability insurance cover,” Jooste said.
According to the minister, legally and procedurally, government is not allowed to provide indemnity to the boards it had appointed.
“The shareholder cannot grant such requests and individual board members are hereby encouraged to take out their own insurance, which is readily available at a nominal fee,” he said.
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