We answer some commonly asked questions to explain how Management Liability Insurance can protect you, your business and your personal assets.
Irrespective of what you do for a living, there is a certain element of risk associated with owning and running a business.
Countless situations present themselves in the day-to-day operation of your business which could see you held liable for many things like, allegations of committing a wrongful act as a business owner, breaching statutory laws and regulations, or you may even experience significant financial loss due to dishonest acts committed by one of your employees.
A Management Liability Insurance policy will ensure you have a strong safety net in place to give greater certainty to the future security of your business.
What is Management Liability Insurance?
Management Liability Insurance is designed to protect businesses and their key staff members against the risks associated with running and/or managing a business.
Who needs Management Liability Insurance?
You should consider Management Liability Insurance if you are a business owner, director or senior manager of either a private or unlisted public company.
The type and extent of your insurance cover can be tailored to meet the specific needs of you and your business.
What are the benefits of Management Liability Insurance?
With authorities actively pursuing businesses that breach safety standards and fail to show due diligence, an insurance program without Management Liability could leave you and your business seriously exposed to a large financial loss.
Management Liability Insurance can;
- Provide protection for your business and personal assets against an unexpected claim;
- Ensure that your cash flow is unaffected by losses or liabilities associated with an insured event, and;
- Provide you with cover for the legal resources needed to defend against an unexpected claim.
What are some common exposures where Management Liability will respond to protect your business?
- Wrongful acts by Directors and Officers
- Dishonest acts by employees
- Claims made by employees resulting from employment practices – Harassment, Bullying, Wrongful Dismissal etc.
- Statutory fines and penalties
- Tax Audit Costs
Which key relationships are covered by Management Liability Insurance?
Management Liability Insurance can protect you against both personal and corporate liabilities from numerous stakeholders including: employees, competitors, creditors, regulators, customers, liquidators/administrators and shareholders.
Which Acts could Management Liability Insurance protect your company against in Australia?
There are 14 acts that companies must comply with:
- The Corporations Act 2001
- Competition and Consumer Act 2010
- The Income Tax Assessment Act 1997
- A New Tax System (Goods and Services Tax) Act 1999
- Privacy and Data Protection Act
- Age Discrimination Act 2004
- Disability Discrimination Act 1992
- Human Rights and Equal Opportunity Commission Act 1986
- Racial Discrimination Act 1975
- Sex Discrimination Act 1984
- Workplace Relations Amendment Act 2008
- Work Health and Safety Act, 2011
- Workplace Relations Act 1996 and Workplace Relations Regulations 2006
Source: ‘It May Happen To Me! The Essential Guide to General Insurance’ by Dr Allan Manning
For more information on Management Liability Insurance, or to request a quotation designed to protect the unique risk requirements of your business, please contact your Whitbread account manager on 1300 424 627.
This article is not intended to be personal advice and you should not rely on it as a substitute for any form of personal advice. Please contact Whitbread Associates Pty Ltd ABN 69 005 490 228 Licence Number: 229092 trading as Whitbread Insurance Brokers for further information or refer to our website.
