Prospectus liability insurance
The prospectus liability insurance protects the company initiating capital investments from being claimed in the form of prospectus liability . The prospectus liability primarily concerns false or erroneous information in an investment prospectus, which induces an investor to invest, but - due to incorrect information - leads to an unacceptable risk of loss or even a partial or total loss of capital for the investor .
The prospectus liability insurance is therefore a special form of financial loss liability insurance . The people who work in the company are usually co-insured. The cover is offered according to the claims-made principle. An extension to judge law is useful, as is multi-year coverage, which covers three limitation periods .
Often the prospectus liability insurance is offered in connection with a D&O insurance .
