The right insurance cover is imperative to protect your business, your employees, and your customers. With so many types of insurance types and multiple variations between policies out there, it can be complex working out how much and what type of insurance your business needs. As an experienced broker, we have the expertise and will take the time to understand your business and source the most suitable insurance for your needs.
Two of the insurance policies available that often get misunderstood/thought to be interchangeable are Management Liability and Professional Indemnity.
Management liability insurance provides protection for a range of breaches that can occur at a management level. In particular, Management Liability Insurance could help with alleviating the financial stress that comes when your company is hit with lawsuits regarding breaches at the management level or mismanagement all together.This can include mistakes or deliberate actions – including fraud – from the company or its directors, officers, or employees – both past and present.
It can cover the cost of investigating, defending, and settling claims by a third party, as well as paying compensation the business is liable for. A Management Liability policy can also cover additional management breaches such as employment practices liability, including unfair dismissal, harassment, bullying in the workplace, statutory liability (including Occupation Health and Safety, fair trading and the privacy act), and crime cover, including theft and fraud by employees.
It is also important to note that without adequate cover, you not only risk losing your business, ruining your brand’s reputation but also your personal assets too.
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Mistakes can happen but if your business is found liable for negligence, the financial impact can be devastating. From lawsuit to a tainted reputation, having professional indemnity insurance can be a life boat; protecting your assests and brand if your advice or services cause a client to take legal action against you.
Whilst professional indemnity isn’t mandatory for all industries, it is highly recommended for anyone who is providing professional services or advice in exchange for a fee. Note that even when you’re outsourcing work to a contractor, you may still be legally liable for any errors they make.
Both types of insurance are highly valuable to SMEs.
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Disclaimer: This aim of this article is merely provided to assist you in understanding basic terms of insurance cover. It does not constitute advice, is not complete and may not be suitable for your circumstances. Please reach out to our team of experts for any questions, discuss full details and personalised advice.