Risk Basic Principles of Insurance Paradox of Trustee Insurance - - PDF document

17/10/2016 1

BASIC PRINCIPLES & CHALLENGES

Presented by Loukia Stylianou 19/10/2016 & 20/10/2016

• Risk

Basic Principles of Insurance Paradox of Trustee Insurance Insurance Approach & Challenges Available Insurance Solutions Conclusion

17/10/2016 2 Trustees’ Liability: Fiduciary duty Professional duty Implications: Criminal liability Civil liability Trustees is not a regulated Profession on its

• wn

A Trustee in Cyprus is usually a Professional General ignorance of the insurance market to

Trustees; consider it part of the services

No Trustee Liability Insurance to fit all needs

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Insurance: A financial risk management tool in which the

insured transfers a risk of potential financial loss to the insurance company that mitigates it in exchange for the premium.

Insurable Interest: A person or entity has an insurable

interest in something when loss or damage to it would cause that person to suffer a financial loss.

Utmost good faith: Utmost good faith is a common law

principle (sometimes called Uberrimae Fidei) which means that every person or entity that enters into a contract of insurance has a legal obligation to act with utmost good faith towards the company offering the insurance. Fiduciary Liability Insurance vs. Fiduciary

Liability Risk

Only Directors & Officers Liability Insurance Trustee liability Insurance exists only where

volume justifies it, i.e. Pension Trustee Liability Insurance in the UK

No “off the shelf product” to fit all needs

17/10/2016 4 Focus is given on regulated professions and

the Directorships allows a scope for gaps

The need of each trustee depends on how the

service is provided, business structure and engagements etc.

Act in utmost good faith with Insurers Transparency on Insurable Interest Select Insurers that understands your

business and have the financial strength to compensate if needed

Professional Indemnity Insurance Directors’ & Officers’ Liability Insurance

17/10/2016 5 Act in the best interest of the Trust Act in utmost good faith with your Insurers