What is management liability?
Management liability is a hybrid policy that combines several coverages essential to standard business operations that are normally sold individually. These policies typically consist of Directors and Officers (D&O), Employment Practices Liability (EPLI), Fiduciary Liability, Professional Liability (E&O) and Crime Insurance.
What are the benefits of a combined policy?
Management liability policies can offer a level of protection not available through individual coverages. The combined nature of the policies allow for fewer gaps and broader coverage definitions.
Because smaller organizations statistically have fewer of these types of claims, it may also come at a reduced cost when compared with buying all of the included coverages individually. While the exposures will always be there, smaller businesses are unlikely to need every form of coverage every year. Combined policies share coverage between exposures to reduce premium costs.
Parts of management liability
Directors and Officers Liability (D&O)
Covers losses caused by a director or officer’s alleged mismanagement or improper conduct.
Employment Practices Liability (EPLI)
Covers losses resulting from employment practices disputes, such as claims filed for discrimination, sexual harassment and wrongful termination.
Covers losses resulting from mismanagement of employee benefit and pension plans.
Errors and Omissions (E&O)
Covers losses resulting from negligent acts, omissions or errors.
Covers losses resulting from employee or outsider criminal activity such as theft, fraud, forgery and employee dishonesty.