Management Liability Insurance not only protects Directors & Officers for legal liability they may incur personally in managing a corporation, it also extends to the corporation itself for certain types of claims. The most common form of incorporated entity to which Management Liability Insurance is offered is the proprietary company. The primary rationale behind extending cover to proprietary companies beyond the realm of a traditional Directors & Officers Insurance policy is that protecting the assets of the private company for many Directors & Officers is protecting significant ownership in those assets through their personal shareholding.
Directors & Officers may be exposed to claims brought against them by:
Management Liability Insurance will generally cover the following amounts in relation to the above actions:
Actions against the corporation or losses sustained by the corporation generally covered by a Management Liability policy include:
You should consider Management Liability Insurance if you sit on the board of proprietary company.
Not all liabilities incurred by a Director or Officer are indemnifiable by the company itself. For example a company is not lawfully able to indemnify a Director or Officer for a liability (other than for legal costs) incurred under a compensation order under s.1317H of the Corporation Act 2001. A Management Liability insurance policy does not have the same indemnity restrictions and may afford cover where the company cannot.
A Director or Officer may still be exposed to claims even if it is found the Director or Officer did indeed act honestly. The fiduciary duty of a Director & Officer to act in good faith and in the best interest of the company creates a higher benchmark than simply acting honestly.
To obtain a quotation or further information on Managment Liability Insurance you can contact one of our experienced insurance brokers on 1300 503 503.
Alternatively, click here to complete a Managment Liability Insurance quote request online.
Why cities are an essential part of securing Australia's future... read more
Brisbane gears up for significant rail upgrades... read more
Budget decisions announced for South Australia... read more
The future of New South Wales infrastructure... read more
The Budget's infrastructure outcomes for ACT... read more