As a company director, understanding your liabilities, risks and challenges can save you when it’s crunch time. And the truth is, your risks come from all angles. It’s easy to assume that professional indemnity coverage will protect you, but this isn’t always the case when a claim is made against your management, instead of your professional advice. 

To navigate this, it’s important to understand the difference between the two. At Morgan Insurance, we’re the experts, and we’ll help you navigate the ins and outs, so you’re not in the dark when you need help. We’ll be by your side every step of the way, starting with ensuring you know what your coverage looks like. 

So, what is management liability vs professional indemnity? Let’s break it down.

What Is Professional Indemnity?

Professional indemnity in your insurance policy protects your advice, design or services that you provide clients with professionally. This is particularly important for individuals in careers such as lawyers, engineers or architects, as their professional advice and guidance could lead to long-term errors or mistakes. 

Essentially, professional indemnity covers you from claims your clients make against your professional services. 

What Is Management Liability?

As a company director, management liability protects you against claims of mismanagement, regulatory breaches or misconduct. This can arise from breaches of company law, employment law, or safety regulations, and claims typically come from employees, competitors or regulators.

Company directors have more to worry about than just business services and operations; they are also looked to for their guidance of employees and administration of the business.

Your Guide To Management Liability:

Management liability encompasses more than you think on your insurance policy. It covers the following: 

• Directors and Officers (D&O): This protects your personal assets if you are sued personally for claims of wrongful acts as a company director.

• Employment Practices Liability (EPL): This refers to claims of harassment, discrimination and unfair dismissal.

• Statutory Liability: Government bodies can issue fines and penalties for things like OH&S breaches.
• Corporate Crime: This protects you from claims of theft or fraud that your employees can make.

So, management liability is elaborate and protects you from a range of risks that you can face as a company director. 

Do I Need Both?

The short answer is yes! If you’re only protected with professional indemnity, you’re exposed to lawsuits and regulatory fines, and if you’re only covered with management liability, you’re exposed to lawsuits from clients. 

The truth is, you don’t know where your claims and risks can come from when you’re busy running a business. That’s why it’s important to be protected with both, so when the time comes, you’re not left vulnerable. 

How Morgan Insurance Can Help

We’re experts. We’ll navigate the insurance market for you to secure the best terms and policy. It’s hard to understand your policy when you don’t know what you’re looking for. There are exclusions, circumstances and liabilities to consider. We’ll help you get up to speed to ensure that you’re fully protected from any challenges you may face. 

Without a specialist broker, like Morgan Insurance, you’ll be left to navigate the process alone, which can leave you with coverage gaps and make it harder to get the outcome you expect and deserve. 

You don’t want to wait until you need to claim to find out you’re unprotected. With Morgan Insurance, you’ll have guidance from start to finish, so you can focus on running your business with confidence. We’ll do the background work.  

Get Started

Morgan Insurance make it easy to get started. Contact us, and we’ll get you set up with coverage that ensures you’re protected from client complaints and employee complaints. When you need all-around protection, we know how to get it. 

Reach out today.

FAQ’s

Can I combine professional indemnity and management liability? 

Some insurers offer combined policies, but they are generally separate policies to ensure that adequate terms and limits are determined for each risk individually.

What is a retroactive date?

The retroactive date is the date from which you are covered on your insurance policy. For instance, if you switch insurers and you don’t carry over your retroactive date, you won’t be covered for all your past work, professional decisions and advice.