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What is management insurance?
When you're running a business, you may be personally liable for any actual or alleged breaches of the Corporates Act. And it's not just large companies that are exposed -small and medium business owners and officers could be at risk as well.
Management liability insurance covers the costs of defending directors, managers and employees against any claims that are the result of their actions or decisions.
Did you know?
The likelihood of a claim that could be covered by a management liability policy has tripled in the last five years, with 50% of notifications resulting in a claim.
(Chubb 2016 Private Company Risk Survey)
The most common claims are for employment practices like bullying, harassment and wrongful dismissal.
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(Chubb 2016 Private Company Risk Survey)
(Chubb 2016 Private Company Risk Survey)
Major claims by amount relate to crime - including employee fraud.
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What it cover?
Management liability insurance policies vary in the benefits they provide. To give you an idea, here's the type of cover that your policy may include:
Employment practice liability
Covers payouts for claims of employment breaches, bullying or discrimination.
Crime
Protects your business against claims such as employee or third party fraud (not all criminal activity is covered).
Defence costs
Covers your legal costs if your business ends up in court.
Directors' and officers' liability
Protects your proprietary limited company's past, present and future directors, officers and managers against claims of wrongful acts, such as misrepresentation or breach of duty (subject to business size).
Corporate liability
Covers costs that your business would incur if you need to defend and settle claims from outside parties alleging wrongful conduct, as well as investigation into the affairs of company.