What Is Management Liability Insurance?
When you are running a business, there are many risks that are ever-present in your day-to-day business dealings and decisions. No matter how big or small your company is, your company and its leaders can be affected by litigation, and your executives and board or directors are particularly exposed without the proper protection.
Management liability insurance is a package of coverages designed to protect your company and the people leading it from a variety of common business risks. Our Management Liability policy offers industry-leading Directors & Officers and Employment Practices Liability insurance to businesses of all sizes and industries.
Who Is It For?
The package is ideal for smaller businesses that will likely encounter fewer and less expensive claims. Non-profits, private companies, and smaller publicly traded companies can benefit greatly from a compromise solution such as management liability insurance, due to its broad, cost-effective coverage.
Large enterprises will typically need to look towards standalone policies to properly address their management exposures.
Why Do You Need Management Liability Insurance?
A company’s management team can be held personally accountable for the consequences of company business decisions.
For example, an investor could allege that the officers of the company didn’t act in good faith when making critical decisions, or that they misrepresented the situation before securing an investment. The investor may bring forth a lawsuit in an attempt to recover their losses.
Similarly, an employee may feel that the company didn’t do enough to protect them from the discriminatory behavior of their co-workers. These claims are more than likely to not only be brought against the company but also against management, putting their personal assets at risk.
Whether the company is dealing with an unsatisfied investor looking to recoup a loss, an employee alleging discrimination, or a governmental audit, its leadership could be targeted legally.
The good news is that insurance products have kept pace with the risks. This means that with a liability management policy it’s possible to get substantial protection from a variety of such risks at a very reasonable price.
What Does Management Liability Insurance Cover?
Directors & officers (D&O) insurance will protect a company and its leaders from financial loss resulting from litigation and regulatory investigations. This policy protects your corporate leaders from litigation related to misuses of company funds, misrepresentations of company assets, breach of fiduciary duty, non-compliance, and more.
Employment practices liability insurance (EPLI) covers legal costs and damages resulting from employee lawsuits filed against the company. EPLI will protect your company and its management in cases of alleged harassment, discrimination, wrongful termination, failure to promote, and more.
What’s Not Covered?
While D&O and EPL do cover very serious and common risks that businesses face on an everyday basis, there are other common exposures that aren’t covered by these two policies. To create a complete and thorough insurance package for your company and your management, the following coverages are also highly recommended:
Professional Liability Insurance: Commonly referred to as errors & omissions insurance, this policy protects you from claims of negligence, errors, and malpractice while providing a professional service.
Fiduciary Liability: This policy will cover defense costs and damages related to claims against fiduciaries who administer and oversee employee benefit plans. It is basically an errors and omissions policy specifically designed for trustees and other fiduciaries who are in charge of running complex company benefit programs.
Cyber Liability Insurance: Protects your company in the event of a data breach or cyber attack. If your company is attacked and sensitive business information is compromised, this policy will pay the costs of notifying your customers, civil damages if you are sued, and even computer forensics.
Workers Compensation Insurance: One of the rare business insurance policies that your company is legally required to buy, workers compensation covers claims related to staff injuries, including medical expenses, lost wages, and rehabilitation.
Business Owners Policy: Another basic insurance product that just about every business should own, a BOP will bundle commercial general liability, commercial property, and business interruption insurance into one package.
What Does Management Liability Insurance Cost?
Just like any other business insurance product that your company needs to purchase, there are many different factors that will determine the cost of your management liability insurance, including the following:
Why Get It With Embroker?
We’ve made it easier than ever before to complete the purchase and get coverage. How easy? We don’t even need to see equity ownership or financial statements from you.
As a digital company, Embroker passes the savings for unnecessary administration on to you—for the most competitive price you’ll find anywhere.
Protect your business with the broadest coverage in the industry. You can tailor policies to your needs by choosing your own limit and deductible.
We provide you with expert support no matter your question: Reach us 24/7 via phone, email or live chat. You even get a personal account manager to look after you and your insurance needs.
Still In Doubt?
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