Management liability insurance is a relatively new type of insurance that protects against allegations of financial injury. It combines directors and officers liability (D&O), employment practices liability insurance (EPLI), and fiduciary liability insurance.
Management liability insurance helps provide protection against:
- Allegations of wrongful termination, discrimination, and sexual harassment, the most common types of complaints against companies. There is a lot in the press about wrongful termination suits and the large court awards or out of court settlements, and management liability insurance provides protection in this key area. In addition, insurance companies who issue this type of protection often offer training to help prevent claims and provide sample communications and policies which can help in preventing suits and problems.
- Charges of mishandling investment funds or failing to carry out investment instructions. It only takes one mistake to result in significant consequences. Even if it is an honest error, it can take years to put things straight, and there can be tremendous financial repercussions. This type of protection can offer an important safety net.
- Shareholder suits alleging a lack of proper “corporate governance.” Allegations of poor corporate governance can have a significant impact on a business, especially in these days where the term transparency is more and more part of the lexicon. Properly set-up management liability insurance can make a huge difference if one of these allegations were to arise.
Contact us today to find out if management liability insurance could be the right fit for your business’ insurance and risk management program.