Management Liability Insurance provides protection to you and your company against risks and exposures of running a company, in other words it covers your liability for mismanagement of the company, and essentially covers your management risk.
Without adequate protection, you, as owner, director, senior manager, and/or officer, may well risk losing, not only the business but also your livelihood and personal assets. This insurance protects you personally and therefore your wealth and assets.
We live in a very litigious world, and actions against your company, its directors, officers and employees can be brought by any number of individuals and statutory bodies such as: WorkSafe, ACCC, ASIC and the ATO, employees, competitors, creditors, shareholders, clients and administrators to name just a few.
Common types of claims we regularly see under Management Liability Insurance relate to: breaches of directors duties and/or fiduciary duties and breach of trust, false, misleading & deceptive conduct by directors/officers and employees, alleged improper and illegal conduct, statutory breach of duty under legislation, employee theft, unfair/wrongful dismissal, discrimination and harassment.
Of course there are many more examples that could be listed, importantly though, Management Liability Insurance may offer you protection from such claims and protect you financially by covering: damages and claimants costs awarded against you, defence/legal cost, Investigation costs, civil fines and pecuniary penalties and crime losses as a result of employee and/ or third party theft.
Management Liability Insurance should not be confused with Professional Indemnity Insurance (P.I.). Professional Indemnity Insurance responds to claims from third parties in respect of the professional or specialist services and advice that you provide, NOT for claims made against you for alleged mismanagement of your company that may have caused loss to others.
In other words P.I. insurance covers the “activities” of the company, whereas Management Liability Insurance focuses on the “act” of running and managing a company.
In summary a Management Liability Policy will cover:
Insured Persons Liability: covers loss arising from claims brought against the directors, officers or employees acting in a managerial capacity within the company.
Company Liability: covers loss arising from claims made against the company
Employment Practices Liability: Covers loss arising from claims brought by past, present or prospective employees, alleging discrimination, sexual harassment or failure to promote, as an example.
Commercial Crime: claims for loss arising from any fraudulent or dishonest act committed by an employee or a third party.
Statutory Liability: claims for loss arising from any breach of a Statutory Act made by the company, or its directors or officers.
Internet Liability: Loss arising from an actual or alleged electronic publishing claim. This includes claims made with respect to libel, slander, plagiarism, violation to right of property or infringement of copyright.
We understand Management Liability Insurance can be a complex matter, however, with over 30 years’ experience, Australia wide in the commercial insurance industry Capital Innovation Insurance Group are experienced an all aspects of commercial insurance and will be only too happy to discuss all your insurance risk and tailor insurance packages and products to your specific needs.
If you would like to talk to us or arrange a meeting please call us on 03 6332 2500.
SIA has partnered with CIIG with the aim of offering our members competitive commercial insurance rates and industry tailored insurance products. For more information on our members-only offer call CIIG on 03 6332 2500.