Company directors should attempt to negotiate continued Directors' and Officers' (D&O) insurance cover for their firm when they leave, it has been suggested.

Richard King and Katie Philipson, partner and associate respectively at law firm Stevens & Bolton, make the assertion in Accountancy Age.

They warn that departing directors remain responsible for claims made against their actions while they were with the company.

Angus Ogg, Special Risks Director at PYV, adds that D&O for UK companies is very affordable, however, directors must ensure that they are not forgotten once they leave their companies, as the consequences could be serious with personal assets at risk.

As such, it could be wise for them to consider the D&O policy which will be in place following their departure.

"Departing directors could negotiate a continuing obligation on the company to maintain existing D&O cover," the authors write.

Finance directors in particular are told to "protect yourselves - review your D&O cover and indemnities and keep that paper trail".

The comments come ahead of the October 1st introduction date for the revised Companies Act 2006.

Margaret Hodge, minister of state for industry and the regions, states that while the Act "simply codifies the existing common law obligations of company directors", in instilling a requirement for them to act in the interests of the company - and not of society at large - a "radical departure" has been made from previous requirements.

PYV are one of the UK's leading providers of professional indemnity insurance. This news article has been produced by Adfero in collaboration with PYV and its unauthorised use is not permitted.