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Management Liability: The most Important cover you may know the least about.

Business Insurance Liability Insurance Small Business Insurance Business Interruption Insurance

What is Management Liability?

Management Liability insurance covers a wide range risks, which arise from actions and decisions of directors, officers and managers while running a business. Improper conduct such as sexual harassment, unfair dismissal or defamation are some examples of risks which can be covered.

Because the breadth of risks covered by Management Liability is broad, it’s sold as a package of separate covers. Each cover addresses a different risk. Your broker will review your business and suggest the most appropriate management liability for your business.

What cover is included in Management Liability?

Management Liability includes the following covers:

Directors and Officers Liabilities – this provides insurance cover for company mismanagement which results in legal action against directors or senior managers.
Corporate Liability – covers the company should it need to pay a director or officer due to a claim of mismanagement.
Employment Practice Liability – provides insurance for areas such as wrongful or unfair dismissal, harassment, discrimination etc.
Statutory Liability covers risks resulting in fines or penalties as a result of a law or regulation being broken eg. Workplace health and safety or privacy laws.
Crime Protection covers the business against losses due to employee and external theft and crime.

Who should buy it?

This product is specifically designed for small to medium sized private company or co-operative. If you employ staff, then at a minimum, Employment Practice Liability should be a seriou consideration.

Ignorance of the law is no excuse – so protection is important

It can be difficult to keep abreast to changes in laws and regulations relating to businesses, but ignorance is no excuse. For example, on July 1 this year, a new criminal offence of workplace

manslaughter was introduced into occupational health and safety laws. Breaches can result in 25 years imprisonment for individuals. Small businesses are exposed to this and other legal and

regulatory risks and ensuing fines from government or industry regulatory bodies. These fines can reach hundreds of thousands, or even millions of dollars. Even if prosecution does not result in a

fine, defending litigation can be financially crippling.

Management Liability Insurance

General Advice Warning: This advice is general and does not take into account your objectives, financial situation or needs. You should consider whether the advice is appropriate for you and your personal circumstances. Before you make any decision about whether to acquire a certain product, you should obtain and read the relevant product disclosure statement.

All information above has been provided by the author.

Tudor Insurance Australia, ABN 19 876 513 568, AFSL 243299