Management Liability Insurance

Management Liability Insurance

Comprehensive protection for business leaders, senior executives, managers, and organizations.

Zensurance - Manager Director

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Management Director

Insurance for management teams

Whether your organization is a privately held entity or a publicly traded company, its directors, officers, managers, and other senior executives face significant risk exposures. These risks range from fiduciary liability, employment practices liability, and crime liability to directors and officers (D&O) liability. 

Leaders and executive teams make critical decisions that influence how a business operates, which exposes them to heightened threats, including allegations of wrongdoing and lawsuits. Get a tailored, extensive management liability insurance policy to safeguard your business’s leadership team from the risks they face.

Management liability insurance is a customized package of insurance coverages designed to shield senior executives and business owners from a broad range of liabilities that go beyond general liability. 

It includes coverage for dealing with allegations of misrepresentation, failure to comply with regulations or laws, wrongful dismissals, and dereliction of fiduciary responsibilities. It also provides leaders and management teams with protection against third-party or class-action lawsuits.

A comprehensive management liability insurance policy may include the following coverages:

  • Directors and Officers (D&O) Insurance: D&O insurance provides individuals serving on an organization’s management team or board of directors with protection from financial losses and coverage for legal expenses if sued or when facing allegations of negligence, breach of fiduciary duties, wrongful dismissals, and violating regulations or laws.
  • Commercial Crime Insurance: Commercial crime insurance covers business leaders and owners from financial losses due to employee dishonesty, internal theft, forgery, fraud, or embezzlement. It may also provide protection for theft of money and securities while in-transit by a third party such as an armoured car service.
  • Fiduciary Liability Insurance: Fiduciary liability insurance provides business leaders and management teams with protection from allegations of breach of duty or errors or lawsuits related to the mismanagement of an organization’s employee benefits plan or pension plans.
  • Employee Practices Liability Insurance: This type of coverage provides senior executives and leadership teams with protection against allegations of wrongful dismissals or lawsuits related to employees’ legal rights being violated. It can also include protection from allegations from employee claims of discrimination, sexual harrassment, emotional distress, and promotion-related disputes.

There may be additional coverages you may wish to include in your management liability policy. Speak to a Zensurance broker if you have questions about your risk exposure or existing policy.

The cost of a management liability insurance policy depends on a variety of factors insurance providers consider, including:

  • The size of the company and its ownership structure
  • The industry the organization is in
  • Years in business and the management team’s experience
  • The company’s financial standing
  • The organization’s annual and projected gross revenue
  • How many employees you have
  • The business’s insurance claims history

Getting insured is quick and easy!

Complete our 5-minute online application for a free management liability insurance quote.

Common claims scenarios

Disgruntled Ex-Employee

Problem: An employee who was fired launches a lawsuit against your organization’s leaders for wrongful termination.

Outcome: Your employee practices liability insurance may pay your legal defence expenses and any compensation awarded to the plaintiff.

Class Acton Lawsuit Files

Problem: Shareholders of your publicly traded company trigger a class-action lawsuit against your board of directors for negligence because of its plummeting stock price.

Outcome: Your directors and officers (D&O) insurance may cover the cost of the board’s legal defence and any out-of-court settlement or court-ordered compensation.

Employee Stealing Inventory

Problem: After suffering significant financial losses due to a previously undiscovered internal theft ring of inventory by a handful of employees, stakeholders in your privately held company sue the management team for compensation.

Outcome: Your commercial crime insurance may cover the cost to reimburse the losses suffered as a result of the thefts, and your directors and officers (D&O) coverage may pay for your team’s legal defence.

Frequently asked questions

Who could sue a publicly traded company and why?

Employees and potential employees, donors, governments, stakeholders and shareholders, volunteers, and creditors could all take legal action against any publicly traded organization they feel has wronged them or acted illegally.

Who are the insureds in a management liability insurance policy?

The insureds or the individuals who are insured by a management liability insurance policy, includes the current, former, and future directors, officers, and senior executives of a company.

What type of claims are made against non-profit organizations?

Non-profit organizations may face a wide range of claims or allegations, including employment-related disputes, legal action from a donor accusing it of misuse of funds, benefits plan omissions, or lawsuits seeking compensation from the board of directors if the organization enters bankruptcy proceedings.

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Protect your organization’s board of directors and senior management team with a comprehensive management liability insurance policy from Zensurance.

Fill out an application to get a free quote. Our licensed brokers are available to address your concerns and answer your questions to ensure you get the customized policy you need.