Directors and officers of local and international companies will need to be on their toes from litigious shareholders as the change over to 2000 approaches.

Their butts may not be covered by their insurers, depending on how the companies decide to exclude Year 2000 from directors and officers policies, and how the courts interpret such policies.

In a story in today's Royal Gazette (see page 13), a local lawyer warned insurance companies that they might be at risk over indemnity policies for corporate directors and officers.

Worldwide, the issue has torn insurers apart in their approach. Some Australian insurance companies made the news recently by moving to exclude Millennium Bug cover from such indemnity coverage. An Australian law firm survey of 12 insurers found eight has inserted blanket Year 2000 exclusions clauses in their directors and officers policies.

Of the eight, three have said they will not negotiate removal of the clauses while the other five will consider removing them if the insured can provide a persuasive argument.

The exclusion is controversial among the other four insurance companies which don't insert the clause in their policies. Chubb (Australia) has said the Year 2000 issue needed to be addressed during the underwriting process in a similar manner to any other directors and officers exposure.

In a story on the AFR Net services web site (www.afr.com.au ontent 81123 nform nform6.html) a Chubb executive said the company remains committed to underwriting the Year 2000 problem on a case-by-case basis.

"The reason that D&O insurance exists is for issues like Y2K and we find it interesting that other parties say it's a known risk and therefore exclude it from policies,'' the executive is quoted as saying. "Everyone knows there's a Y2K problem, but we don't know that directors and officers are going to be sued over it.'' That's a pretty interesting and revealing statement from an insurance company, which you'd have thought would shy away from opening any hope of payout in this problem.

In The Royal Gazette story on the two local insurance companies (A spokesman at Colonial Insurance was not available for comment), executives warned policy holders they would not be covered for damage caused by the Year 2000.

However the matter is not so cut and dried according to other commentators in the press worldwide. The News & Observer in Raleigh, North Carolina quoted an insurance executive as saying there could be huge payouts anyway and stated that insurance companies are scared of the huge costs. For example if a power company computer bug causes a surge and causes a fire in an attic, a homeowner's policy would cover the damage, according to an underwriting manager for North Carolina Farm Bureau Mutual Insurance Co.

"It doesn't matter what causes the fire,'' he said, adding that if a computer stops your car in front of truck in the middle of a road, collision coverage or the truck's liability would pay for the damage.

A 1998 filing by the New York-based Insurance Services Office also predicted that its members will face big payouts.

Are there any web page designers and graphic artists in Bermuda who think they've got a great looking Internet site? The deadline for submission for the first International Web Page Awards is December 31 (extended from November 30). The deadline was extended I guess because only 300 entries were received.

Entry fees are $85 per site for any one of the 30 categories. Entries can be made by designers, advertising agencies, corporations or individuals at www.webpageawards.com.

As part of a continuing series looking at the Year 2000 compliance efforts of local companies listed on the Bermuda Stock Exchange, Tech Tattle looks at BF&M Ltd. The company plans on being Year 2000 compliant by January 30 next year, chief executive officer Glenn Titterton said.

"We have finished all remedial work to our systems and are now in the testing phase,'' he said.

When the company completes testing it will get an independent audit of its systems compliance and get signed off before the end of next year.

"We have to be somewhat ahead because we do one year renewals on January 1 and we have to be in pretty good shape by then,'' Mr. Titterton said.

Hugh O'Neill, BF&M's vice president of information systems, is in charge of the company's Year 2000 compliance programme and he reports directly to Mr.

Titterton.