Bill Joseph

LLB(Hons)MAK | PGDip. Law (LDC) | Lawyer | Speaker-Emeritus @LDC_Uganda Lira Campus | Chairperson-Emeritus @Makerere 89th Guild Tribunal | Debate enthusiast

[Bill Joseph @ainerugaba]

A miracle from God!

[Bill Joseph @ainerugaba]

Your first point demonstrates that that you have not appreciated life insurance. All along I have been assuming that you have done insurance law. Read section 133 of the insurance to appreciate that a keyman is just part of life insurance. There’s no such thing as keyman and standard personal life life insurance. That’s your own creation.

Your second point also demonstrates that you need to appreciate the difference between risk and loss. You can’t insure against “risk of loss”. There’s no such thing in insurance. Again, it looks like you have not done insurance law at undergrad. A risk is an uncertain even that may or may not occur or if it will occur it is uncertain when it will occur. In life insurance, we insure against risk happening with an agreed amount paid on it occurring. In Indemnity insurance, we insure against risk but the amount paid is determined by the loss that has been occasioned by the risk occurring. Again, I feel like I am now going through basic concepts of insurance law. So it is erroneous for you to say a keyman insures against the “risk of loss”. It shows that you have not appreciated the two concepts in insurance law. I go back to my earlier comment on the same and that is my position. On authorities, I can send you an entire reading list with case law on all these concepts.

On your third point, I refer you to section 133 of the Act as the starting point of understanding what a keyman is. These conditions are in the law and case law. You cannot wish them away. For example, you cannot have life insurance without an insurable interest and a keyman is part of life insurance. I don’t know what other qualifiers you’re talking about but I have already laboured to explain the mistake you’re making by confining a keyman to just one of two risks instead of appreciating all its elements and distinguishing between risk and incurable interest.

Your fourth point alone shows that either you have not appreciated these concepts before or you didn’t get my argument hence you’re making the same mistake. You’re focusing of the the nature of risks to determine if something is a keyman or not yet I am telling you that all it takes is for there to be an insurable interest by the company on the employee and any identifiable risk arising out of that interest. You’re hell bent on focusing on which type of risk exists yet that is something that can be negotiated in the market. It is not a legal concept.

Let me conclude with this. Just take time off and read about all key elements of an insurance contract, a life insurance contract and an indemnity insurance contract. Everything will start making sense otherwise I will end up discussing most of it here from scratch.

[Bill Joseph @ainerugaba]

If I were a Corporate and Commercial Practice PA at LDC or a lecturer of Insurance Law at Makerere, I would set a question on keyman policy/insurance to test how many read global news and appreciate it. A student should be able to tell us how Nvidia could have mitigated this scenario of its former CEO Jensen Huang resigning amid serious spy allegations. And how the company can ensure stability and business continuity until a replacement is found.

[Bill Joseph @ainerugaba]

The fact that we’re dealing with a keyman, I believe we’re dealing with life insurance and not indemnity insurance. And once you know the difference then you shouldn’t be bothered by what “loss” has occurred.

In insurance, you insure against risk, not loss.

Once again, here is my answer to you. A keyman insures a risk against a key employee of a company by virtue of the fact that once that risk occurs to the employee it will affect the company because the company has an insurable interest on the employee.

Such a risk can be death of the employee, disability of the employee (the common risks) but can also include an employee being compromised or hacked (like in Nvidia’s case) or even retirement.

The mistake you are making is confining a keyman to one or two particular risks thereby failing to appreciate what makes it a keyman. It is not the fact that a specific risk or event has occurred alone that defines it as a keyman. It is because a risk occurs to an employee that is important to the company and the company will be affected (insurable interest) by virtue of that event happening. The nature of the insurable interest is therefore what makes it a keyman, and not the nature of risk.

Going back to your introduction to insurance law, you will understand that it is an offshoot of contract law. Therefore insurance companies and the insured have freedom to contract. And that’s why I am saying the fact that something is common in the market doesn’t mean it’s the only thing that can happen.

This should be able to clarify what I mean.

[Bill Joseph @ainerugaba]

Does it protect the company from sales plummeting and shares falling and in the absence of third party claims? I don’t think so. The company’s main interest now is business continuity (steady capital and cash flows, debt settlement, etc) and you can’t get that from your D&O.

I have also mentioned that you advise the company of the risk that should be covered in the keyman. The fact that most standard keymans cover death does not mean that you can’t add anything. The underlying factor of a keyman is the importance of the person. 20% of Nvidia’s stock value rested on Huang being CEO alone. You can’t cure that 20% with a D&O.

Second, Huang’s affair is not a management decision. The decision to sell chips to the Singapore company was legal and appropriate by company policy and was not taken by him as an individual. Third, there are no claims yet to trigger a D&O.
In short, clearly identify the risk the company is guarding against. Is it that directors can make wrong decisions or is it the stock value? That is why I emphasize understanding what your client needs, not what you think they need.

[Bill Joseph @ainerugaba]

First, D&O mainly covers compensation related claims arising out of Director actions. Second, you’re assuming new facts. Third, once you have a client, the first thing is to understand what they need and give them advice that directly addresses that.
With that, let me address your questions;
1. If your client is the company, it’s main interest is business continuity, share value maintenance (investor confidence) and sales (customer confidence). All these factors can only be addressed by a keyman because it is taken out by the company on a key employee like the CEO whose departure can affect all these.
2. The D&O you bring in only arises once shareholders bring a professional negligence claims (wrongful acts) against the Directors and need compensation. It may also cover related costs like legal costs and investigations costs. It would mainly come in as an addition if your new facts are taken into consideration.

[Bill Joseph @ainerugaba]

@jain0000001 😂😂😂 that is a different question altogether

[Bill Joseph @ainerugaba]

It depends on how you look at it. If you’re advising on mitigation strategies, make sure the keyman covers that risk. You can even opt of a comprehensive cover. If you come in when the risk has occurred, you have to study the policy and determine whether it covers such a risk and advise accordingly. So we don’t know what kind of keyman Nvidia has but at least we appreciate the concepts at play.

[Bill Joseph @ainerugaba]

@housaine0 That’s a stretch. The immediate issue arising is that I have discussed.

[Bill Joseph @ainerugaba]

I was taught keyman policy insurance by Dr. @RKirunda at undergrad when he was teaching insurable interest and people (some lawyers) are here wondering what principles arise in such a scenario. I still remember that lecture like it’s yesterday. You can never get it wrong when you are taught by the best.

[Bill Joseph @ainerugaba]

If I were a Corporate and Commercial Practice PA at LDC or a lecturer of Insurance Law at Makerere, I would set a question on keyman policy/insurance to test how many read global news and appreciate it. A student should be able to tell us how Nvidia could have mitigated this scenario of its former CEO Jensen Huang resigning amid serious spy allegations. And how the company can ensure stability and business continuity until a replacement is found.

[Bill Joseph @ainerugaba]

@AsinjyaEdwin https://t.co/1QSdSIvcPc

[Bill Joseph @ainerugaba]

@housaine0 The topic is “Insurable interest”. Section 133 of the Act. I learned that at undergrad. Basic stuff.

[Bill Joseph @ainerugaba]

@housaine0 The topic is “Insurable interest”. Section 133 of the Act. I learned that at undergrad. Basic stuff.

[Bill Joseph @ainerugaba]

@nisimbinmasoud That’s a lot better than what you are. A no body!

[Bill Joseph @ainerugaba]

@zLbf2zsz You can easily tell a brain that can’t comprehend basic concepts. 😂😂 Now what has annoyed you? Ignorance?

[Bill Joseph @ainerugaba]

Sky News is reporting that 20% of Nvidia’s stock market rests on Jensen Huang’s position as CEO, meaning it is tied to investor confidence in the company by merely him being in charge. Now that he is gone, Nvidia's stock market has already plummeted by 10 points already.

[Bill Joseph @ainerugaba]

If I were a Corporate and Commercial Practice PA at LDC or a lecturer of Insurance Law at Makerere, I would set a question on keyman policy/insurance to test how many read global news and appreciate it. A student should be able to tell us how Nvidia could have mitigated this scenario of its former CEO Jensen Huang resigning amid serious spy allegations. And how the company can ensure stability and business continuity until a replacement is found.

[Bill Joseph @ainerugaba]

I am going to slap a Boda Boda guy one day

[Bill Joseph @ainerugaba]

@EGakiza @SolomonSerwanjj @RicOkello Most definitely. Perhaps they feel their resources are well accounted for.

[Bill Joseph @ainerugaba]

You want me to refer and your riders rob them. Nedda! This one we shall gate-keep until you understand that even when you are right, good client management and customer care service is important. A customer cannot reach out to you and you just discard them like that. Shame on you.

[SafeBoda @SafeBoda]

Colleagues, your contacts list is full of ride potential... and the discounts are BACK!
Stop gatekeeping the good commutes. Scroll through your contacts, pick a newcomer who has never used SafeBoda, and send them your code:
- Send code to a newbie
- They discover the perks
You enjoy exclusive rewards too!
Learn how to redeem yours step-by-step: https://t.co/BvvHBOFTwI

[Bill Joseph @ainerugaba]

@Kalungi_H_Rae It is called a beneficial ownership form detailing the ultimate human being controlling the company. In the circumstances it can only be the line minister

[Bill Joseph @ainerugaba]

@AnkundaElly1 Big up bro! Hongera sana!