Research On Legal Issues Related To Director's And Officer's Liability Insurance

Director's And Officers' liability insurance originated in the United States in the 1930s and developed in the Anglo-American legal systems.The main function of D&O Insurance is to protect the interests of directors and senior managers,especially in the context of the separation of modern company ownership and management,the company's governance structure is gradually transformed from the original "shareholder-centered doctrinet" to the present "Board of directors".It is important to note that directors of executives in the company's development of the right to gradually expand.At the same time,they should also assume the corresponding obligations and responsibilities.The risk of managing directors'performance is becoming more and more important,while the excessive risk restricts the enthusiasm of their duties.Therefore,it is necessary to transfer directors' liability insurance to the risks faced by executives in the management of the company.It is based on the system value of Director's And Officers'liability insurance,which introduced the liability insurance system in early 21st century.However,the liability insurance of directors as a foreign transplant to our country's occupational liability insurance,although it has developed for more than 10 years in the insurance market,but the mainland listed companies in the rate of insurance is still very low.Why is the legal systems in the United States and other developed countries that has proven its value,but it is unpopular in China's listed companies?There are two main reasons:on the one hand,there are obstacles to the legal system which is closely related to the development of the D&O Insurance system.Firstly,the legal basis of the directors' liability insurance is insufficient,and only two normative documents issued by the SFC are directly stipulated;China's directors of civil liability system is imperfect,and the relevant provisions are too brief,which lacks operability.Thirdly,the shareholder representative litigation system is imperfect.In the prosecution of directors violating the duty of diligence in civil compensation,shareholders can hardly prove that directors violate the duty of diligence,let alone the directors to bear the corresponding responsibility.On the other hand,the Director Liability Insurance clause itself also has some problems,such as the specific insurance provisions on the existence of foreign provisions to copy,and not adapt to the situation.The above-mentioned legal issues are urgently needed to improve the internal needs of the system and the consideration of the liability insurance for development directors.Therefore,in the company law,it is necessary to explicitly stipulate that companies have the right to purchase directors' liability insurance for their directors and senior managers,and to improve the civil liability system and shareholder representative litigation system related to directors' liability insurance,at the same time to amend the unreasonable clauses of existing directors' liability insurance.This paper is divided into four parts.The first part is the generalization on the D&O Insurance,which introduced the some basic concepts of D&O Insurance,and systematically introduced the D&O Insurance system.It can lay the groundwork for the discussion on the legal issues of the latter text.The second part,on the basis of describing the present situation of the development of D&O Insurance in our country,it analyzes the legal problems existing in the development of the D&O Insurance system from the two angles of the legal system and the liability insurance clause.The third part,based on the research of the D&O Insurance system in the United States,it analyzes the development course of the D&O Insurance system and the specific system design.Thus,the enlightenment of the development of our D&O Insurance system is drawn up.The fourth part proposed to improve our D&O Insurance system based on the experience of American directors' liability insurance in the second part of the legal issues involved,hoping to establish a system of directors' liability insurance conforming to our country's conditions.