As some businesses have now reopened and staff members are returning to work, issues may arise within the workplace, for example, issues with employees around furlough, as well as problems with customers including issues with contracts and pressure from shareholders. Management Liability protects both individuals, in the form of Directors and Officers Liability, and companies in the form of Employment Practices Liability and Corporate Legal Liability, where claims are being made against them.
Below, we interview one of our Commercial Account Executive’s, Stephen Marriott-Smalley, who talks us through why MLP is so important for your business.
What are the key benefits of a Management Liability Policy?
The policy protects the directors, business owners and senior management of a company against any errors or omissions which could land them with legal problems or disputes. Accusations can be made from shareholders within the business as well as outside parties, and it can be the individual who is held accountable. Directors and Officers Liability protects the individual from fines, penalties, compensation and defence costs, as long as the Director or Officer has not acted criminally or intentionally.
As we are aware, claims can arise from a wide range of sources such as regulators, customers, employees, competitors, shareholders and administrators, causing significant stress for the directors and the company, whilst also being extremely costly and time consuming. Personal Liability & Company Liability will protect you against claims from any regulator within the UK, including fees for intervention.
In the UK there is currently no fee for an employee to make a claim to the Employment Tribunal. A vigilant business needs to consider their legal defence costs if allegations are made against them. Employment Practices Liability covers legal costs, awards and settlements for any employment claims brought against you or any past, present or future director/trustee, officer or employee. This includes defence for claims such as unfair dismissal, discrimination and sexual harassment.
MLP also covers you against criminal and fraudulent activity. Companies are often the main target of sophisticated criminal networks and disgruntled employees. A crime cover extension can offer valuable protection against an increasing threat of both random and targeted criminal activity. Covid-19 has resulted in many people working from home with increasing opportunities to gain access to unprotected systems. Since lockdown, fraud has increased by 66%, in particular due to people falling for online scams.*
Does the policy include legal advice?
Yes, there are policies available that will include legal advice. For example, through AXA, we provide an MLP policy that includes free access to leading law firm, rradar, providing in-depth legal assistance, as well as access to digital tools to educate, manage and advise business owners on how to reduce their legal risks.
During these uncertain times, this proactive service is extremely valuable, and is a free service included within the product.
Is the cover available for small businesses?
Small and Medium Enterprises (SMEs) account for 99.9% of the UK’s business population, providing employment for 60% of the UK**. Therefore it is vital to the economy that these types of businesses have the correct cover in place. Having incorrect insurance can lead to a business collapsing should a claim arise.
How much does the policy cost?
The premium starts from as little as £250 per annum for a sole trader, depending on the size and turnover of your organisation.
If you would like some more information about our Management Liability package or would like to discuss your business insurance, contact Stephen on 07585 400814 or by emailing email@example.com. You can find out more about what we have to offer for businesses, here.