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What is Management Liability Insurance?
A Management Liability Insurance (also known as Directors & Officers Insurance) is a type of policy that is there to protect your company and its managers, directors and officers from any financial losses due to claims arising from their mistakes or actions.
For example, it can help to protect your business, and the directors and managers, from financial losses that might arise out of any claims of discrimination, harassment, fraud, or wrongful termination brought against these individuals in their capacity as directors and officers while managing or running business operations.
In such situations as these, a Management Liability Insurance provides an extra level of coverage against all kinds of unpredictable and potentially large liability claims, as well as covering some of the losses due to a lawsuit.
Why do you need a Management Liability Insurance?
Management liability insurance is there to help businesses of all sizes, big and small, protect against unpredictable and potentially large liability claims due to mistakes or actions like harassment and fraud from the company or its directors and officers. But why do you really need it?
What will a Management Liability Insurance Cover?
When you get a management liability insurance, your business will be protected in case of....
What is not Covered?
Since we at Digit believe in transparency, here are some cases where you won’t be covered.
How much does Management Liability Insurance cost?
How much your Management Liability Insurance premium will cost will be is based on a number of factors, like:
- The nature and type of your business and the industry in which it operates
How many managers, directors and officers are a part of the company
The number of employees
The size of your company
Where your business is located
The past claims made against your business
The company’s estimated revenue and/or profit
The total number of assets
The limit of liability that you opt for
Other factors that might affect the insurance premium are the age of the company, its financial stability, its trading patterns, and shareholders.
Which Businesses need a Management Liability Insurance?
If your business could need protection from internal or external claims against managers, directors and officers, you might benefit from getting this insurance. Management liability insurance is important for businesses of all sizes, whether they are big or small to protect against potentially large liability claims. However, please note that some businesses might not be eligible for a Management Liability Insurance, such as companies that do not have a registered office in India, political organizations, and more.