Management Liability insurance protects the individuals and the company in relation
to exposures associated with managing a company.
Propriety companies and their directors continue to face greater
corporate governance and increasing regulatory surveillance of the
management of their business activities.
Traditional directors' & officers' policies have been written to
only protect the assets of individual directors and officers. In the
past any available cover for the entity under these policies has been
limited only to optional extensions, such as employment practices
liability cover and comes with the added risk of eroding the directors
and officers' policy limit.
Consequently, some proprietary companies have preferred to remain
uninsured, exposing their owner directors and officers to the risk
of expensive and time consuming litigation. This has been despite
the fact that proprietary companies and their directors are directly
exposed to risky litigation from a variety of different sources such
as minority shareholders, employees (unfair dismissal, discrimination
and sexual harassment), creditors and State and Federal regulatory
bodies (i.e. ACCC, ASIC and ATO).
