Liability Insurance
Public Offering Of Securities
The Indian capital markets are witnessing an unprecedented boom and corporate India is all set to leverage this opportunity to raise funds and achieve their corporate objectives. However, this increased market exposure leads to increased stakeholder litigation and with this increase in litigation comes a growing awareness of the responsibilities incumbent on the directors and officers of companies. This is especially true when the company makes a public offering of its securities. Signatories of a public prospectus have a personal responsibility for its contents and could therefore be found personally liable for the losses of securities holders arising from misrepresentations within the prospectus. These potential liabilities arising out of the issue of a prospectus can be very large. Most securities actions are fuelled by unfulfilled investor expectations, so as well as being substantial, legal actions can also occur much after the transaction. IPO Insurance (also known as Public Offering of Securities Insurance – POSI) addresses these uncertainties by ring-fencing securities exposures in a single premium, transaction-specific policy.