New Delhi: Bharti Walmart’s ongoing global investigation against alleged corrupt practices involving the US retail giant might prove to be very expensive for HDFC Ergo General Insurance, as per a newspaper report.
The Economic Times has reported that the insurance cover to the tune of USD 5 million may be triggered incase a legal suit is filed against the company.
HDFC Ergo General Insurance has covered insurance worth USD 5 million as a part of directors & officers' liability cover (or D&O policy) with Walmart.
The D&O policy means that the insurance company will bear the expense of the litigations or lawsuits (if any) with the company that has been covered.
Citing its sources, the paper said that the policy will get triggered incase the directors are accused of any misconduct. However the policy will be applicable only when a legal suit is filed.
Bharti Walmart has suspended five people, including CFO Pankaj Madan, as part of an ongoing global investigation.
Madan and four out of the five-member legal team of Bharti Walmart were suspended on Tuesday as part of the ongoing investigation over allegations of corrupt practices against the company in foreign markets, including India.
Bharti Walmart is a 50:50 joint venture between Bharti Group and Walmart stores Inc for running of wholesale stores under the Best Price Modern Wholesale brand.
With Agency Inputs
First Published: Saturday, November 24, 2012, 10:27