WHAT COULD GO WRONG AND WHY YOU NEED

MANAGEMENT LIABILITY INSURANCE

What Management Liability Insurance Covers

Management Liability Insurance protects business owners, directors, and senior managers against claims arising from the management of the business.

Typically, it covers:

  • Directors & Officers (D&O) Liability – claims against directors or managers for alleged wrongful acts in managing the business
  • Employment Practices Liability – claims from employees such as unfair dismissal, discrimination, or harassment
  • Crime / Employee Dishonesty – losses resulting from theft, fraud, or dishonest acts by employees
  • Tax Audit Costs – professional fees incurred during official tax audits or investigations
  • Legal defence costs – expenses to defend claims, investigations, or regulatory actions
❋ Scenario 1 
Unfair Dismissal Claim

An employee is terminated and later files a claim for unfair dismissal, alleging they were treated unjustly. The business must respond legally, even if the claim is unfounded.

❋ What is covered by Management Liability Insurance

Management liability insurance can cover legal defence costs, settlement amounts, and expenses related to handling the claim.

❋ Scenario 2
Employee Theft

A long-term employee is discovered to have been transferring small amounts of money from the business account over time, resulting in a significant financial loss.

❋What is covered by Management Liability Insurance

Management liability insurance can cover the financial loss caused by the employee’s dishonest actions, along with investigation costs.

What’s Usually Not Covered by Management Liability Insurance

  • Intentional or fraudulent acts by directors or owners (once proven)
  • Known issues or prior claims before the policy started
  • Bodily injury or property damage claims (covered under liability policies like Public Liability)
  • Professional errors or advice (covered under Professional Indemnity Insurance)
  • Contractual liabilities beyond normal legal obligations
  • Fines and penalties that are not legally insurable
  • Personal matters unrelated to the business

Book Your Consultation

BOOK NOW