Directors' Liability Insurance System

As the development of the morden market economy, there are more and more attentions paid to the protection of shareholders and stakeholders. Correspondingly,there are more and more risks and liabilities on directors .Owning to the encouragement of laws ,such as new corporate law,paper law and the support of concerning litigation systems,the amount of the cases brought against directors for damages has increased dramatically.As an an effective risk diversification mechanism, D&O liability insurance helps us deal with the dilemma mentioned above. It also contributes to sustain the balance of the rights and liabilities of directors and to promote the modernization of corporate governance.Because D&O liability insurance is a new thing in china,and is at the stage of beginning.There is almost no concerning law.On the basis of current domestic situation mentioned above, the author tries to, through comparing and discussing the D&O liability insurance system of developed countries, referring to their experiences,provide some systematic analysis which help to establish D&O liability insurance system in China.This thesis includes four parts:The first part is of summarization about D&O liability insurance. The main content of this part is to introduce the concept and to analyse the legal characteristics and types of D&O liability insurance,then introduce the emergence and development in foreign countries and in our country.The second part focuses on the analysis of the function and value of D&O liability insurance in the present corporate governance,which is an important part..In this part,firstly discuss the function of D&O liability insurance in the present corporate governance,then, analyse the conflict and correspond between D&O liability insurance and civil liabilities system. Lastly,point out the superiority to corporate indemnification system.Part three and four is about the building of D&O liability insurance system in the present corporate governance.It is an important part of the article.Issues related to D&O insurance contract are expatiated in detail in this part,including parties of the contract,definitions of the insured, the insurable interest,liability coverage,exclusions, apportionment of premium and insurance indemnity and so on.Finally,the conclusion points out the foreground for the development of D&O liability insurance in China.