Many Indian companies want to grow and develop. Some companies are focusing on raising capital in the Indian capital market to meet their expansion plans. However, litigation involves many risks that the company may face from its shareholders. Given these alarming and sensitive risks, some insurance companies in India offer initial public offers or initial public offers.
Companies listed on the BSE or NSE present threats or risks that can seriously damage the reputation of the company and can also lead to significant financial losses. Regulatory authorities can initiate severe legal action if the Securities Act is violated. Liabilities may also arise from inaccurate information presented to investors in the prospectus. In some instances, the responsibilities may lead to the settlement of claims for breach of the obligations of the subscription contract. In such a situation, the company is not only exposed to significant damage to reputation and cash, but also the management or directors of the company, insurers, etc. You may also need to take legal action. This is why it becomes so essential for a business to have financial protection against all the potential liabilities offered by an IPO insurance policy. Some insurance companies offer such insurance coverage under other names such as free title insurance or IPO insurance.
IPO insurance protects the insured against claims on securities that come from a company’s range of protection.
Coverage of the liabilities of negotiations, debates, and decisions related to the offer.
Cover for punitive and exemplary damages.
IPO insurance is used by companies and their managers concerned by the risk of public fundraising. This works when investors suffer losses if they rely on an incorrect disclosure from the insurer, directors, and the company making the offer. Investors can use these parties to offset losses. With IPO insurance, you can use the coverage of companies and their managers for investor claims related to the offer.
All insurance companies that offer IPO insurance can have a claims process that meets their internal criteria and systems. Here are some steps for the IPO claim process:
In a condition covered by this insurance policy, the potential customer’s liability claim may arise. The insured person can send a written notification to the insurance company as soon as possible
The notice may include all the details of a right to a public offer, the parties concerned, copies of all the documents which open the procedure, the details of an official investigation, etc.
By registering the insured person’s claim, the insurance company may provide defense costs based on the expenses incurred before final disposal or allocation
For the most part, all insurance companies support the insured or the policyholder and advise on the proposed measures to resolve liability claims.
The lawyers appointed by the insured person must be approved beforehand by the insurance company, and the insured person can only agree if the insurance company agrees with them and makes them available in writing.
The insured will assert all defense and counterclaims for contributions, compensation or damages
The amount of the claim under different sections of the policy or insurance coverage would not exceed the sum insured for each risk covered by the system. Therefore, when it comes to the responsibility of the potential customer, the appropriate sum insured should always be allocated
As mentioned, if the policyholder encounters a problem that has not been adequately dealt with by the branch or regional office, most insurance companies will, for the most part, give clear instructions on how to resolve the problems.
Copy of brochure / detailed list
Percentage of titles offered
Value of securities offered
Copy of the placement/subscription contract
General insurance Tata AIG
General insurance from Bajaj Allianz
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