News Releases

UK Company Law Reform and Changing Litigation Environment Will Increase Exposure of Individual Directors' Personal Assets says ACE
Nov 27, 2006

LONDON--(BUSINESS WIRE)--New legislation designed to simplify and improve company law in the UK and increased litigation involving directors and officers will put the personal liabilities and assets of individual senior executives at greater risk, according to ACE European Markets (NYSE:ACE) which today launches its new personal asset protection programme for directors & officers in the UK under the brand name CODA.

Key proposals within the Companies Act 2006 focus on providing clarity as to the specific duties of directors and introducing procedures to allow shareholders to bring derivative actions against boards of directors. It will also allow accountancy practices to limit their liability to audit clients  all of which will place a greater emphasis on the responsibilities and, therefore, the liabilities of individual company directors.

Charles Davidson, Underwriting Manager, Professional Lines, ACE European Markets said: By enhancing shareholders ability to bring derivative actions and allowing auditors to limit their liability, the Act will have the effect of transferring risk exposures directly on to the shoulders of individual company directors. This will significantly increase their exposure to claims where they cannot be indemnified by their companies.

This Act, coupled with the growth of litigation in general and no win, no fee arrangements in particular, has the potential to directly impact on the personal assets of some of the UKs most senior company executives.

Against this back drop it is more important than ever that senior executives have the maximum personal financial protection in place to enable them to fund lengthy legal disputes as well as potentially catastrophic settlements.

The CODA wording and cover has been specifically developed for UK directors and officers. CODA is designed to sit as an excess layer of cover above traditional D&O programmes and offers individual company directors and officers some of the broadest and most responsive levels of personal asset protection currently available. The benefits of the policy are paid directly to the individuals rather than the company in the event of a claim.

Key features of the product include: dedicated limits of indemnity that apply only to non-indemnified losses incurred by individual executives, which ensures they are not effected by losses incurred directly by the company; a drop down facility that enables CODA to provide primary cover in areas where the underlying insurers are more restrictive or not prepared to give coverage; and broader definitions or more limited exclusions in many areas of direct relevance to individual executives that may not be found in traditional D&O policies.

Commenting on the launch of CODA, Anup Seth, Managing Director, ACE European Markets, said: There is significant potential for CODA in the UK. Currently around 15% of UK companies purchase this form of protection for their directors and officers. Therefore we see the changes in company law driving increased demand by individual executives for high quality and responsive asset protection. CODAs new UK product has been specifically designed to respond to this demand.

ACE has extensive experience and underwriting expertise in this class of business and this together with our recognised financial strength and stability should provide a strong platform from which to grow CODA in the UK.

Notes to Editors


Corporate Directors & Officers Assurance Limited (CODA) was formed in 1986 by its policyholders and acquired by ACE Bermuda in 1993.

CODA is designed to give comprehensive financial protection to directors and officers when their company fails to indemnify them or when traditional insurance programmes fail to respond. The original CODA product is offered by ACE Bermuda to a broad range of directors and officers of Fortune 1000 corporations, and is widely recognised as the premier provider of excess/difference-in-conditions insurance in the US marketplace.

The newest CODA product is designed specifically for the UK market and has been developed by ACE European Markets in collaboration with CODA underwriters at ACE Bermuda.


ACE European Markets Insurance Limited (AEMI) is a wholly-owned subsidiary of ACE Bermuda. It was established in Dublin in 1997 to provide low-frequency, high-severity excess capacity to European and international clients following the underwriting discipline and guidelines developed by ACE Bermuda for the US market, and adapted to the international environment. AEMIs London branch office opened in 2001 to provide additional support to UK and European clients.

AEMIs professional lines department principally operates out of the London branch, where CODA submissions can be handled from a wide range of Lloyds and non-Lloyds brokers. Additional information on ACE European Markets can be found at


The ACE Group of Companies is a global leader in insurance and reinsurance serving a diverse group of clients. Headed by ACE Limited (NYSE: ACE), a component of the Standard & Poors 500 stock index, the ACE Group conducts its business on a worldwide basis with operating subsidiaries in more than 50 countries. Additional information can be found at:



Katie Weeks, Communications Dept., 020 7173 7585