Entering the Battlefield

Robust management liability coverage will enable you to sleep soundly at night. But how many of you are still operating with directors and officers coverage without realising they are wide open to claims? Or worse still, how many hof you aven’t considered the importance of such a policy?

It’s not just big businesses that face the prospect of long, drawn-out court battles over everything from unfair dismissal and regulatory discrepancies to occupational health and safety concerns. Small-to-medium enterprises are being drawn increasingly into the quagmire of litigation and business interruption – and the quickly escalating associated costs.

But, for as little as $500, those small-but-going concerns – and even the larger enterprises – can cover themselves against such potential problems, as well as the standard business insurances of fire, crime, and public liability.

“As soon as businesses start employing staff, have a director or shareholders, or handle monies on behalf of third parties, they should look into taking out management liability (ML) insurance,” says David Porteous, General Manager for Brooklyn Underwriting.

Porteous says ML has moved on from the traditional directors and officers liability insurance as Federal and State legislations and regulations became increasingly more complex, and leave not just ’bosses’ at risk of exposure, but employees as well.

“We are seeing the largest number of claims in the management and employment practices areas,” says Porteous. “Employment practices liability insurance can be taken out as part of a package for ML, and can cover things such as unfair dismissal, lack of advancement or even sexual or workplace discrimination.

“Anyone who operates a business is exposed to hundreds of pieces of legislation, and businesses are becoming more aware of the sheer breadth of exposures they face in the day-to-day operations of running their business. These days a ML policy can even extend to cover such things as crisis management, theft and fidelity and pollution defence.”

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Source: Insurance and Risk