Management liability insurance is now a greater part of business insurance than it ever has been. As risks get more complicated for owners, executives and managers, more extensive insurance plans have become increasingly necessary.
The cover gives business leaders greater protection and more freedom to work, and as popularity has grown, the range of risks covered in policies have evolved too.
This is according to a recent report by Insurance & Risk Professional, which said that insurance providers are competing to win market share of the product, meaning consumers can grab a better deal.
Speciality Risks Practice Leader for underwriter DUAL Australia, Jaydon Burke-Douglas, said a management liability insurance product now offers more for less.
“Originally it was just a barebones cover, and it’s evolved into a one-stop shop for all of management-type exposures for a very nominal price, with the average premium under $2,000 for one of these products,” he told Insurance & Risk Professional this month.
The publication also pointed out that as of 2011, only 16 per cent of all Australian businesses had management covers such as directors and officers insurance. While this has grown since, it has not been taken up by businesses in a proportionate way, Mr Burke-Douglas said.
“We think about 80 per cent of businesses within Australia don’t purchase management liability insurance, which is insane when it covers things like crime exposure, employment practices liability, directors and officers liability and cyber-risks,” he continued.
Management liability insurance may see a greater uptake among family-run businesses, especially as competition makes the product a better buy. Directors of these types of enterprise often have their own assets financially linked to the business, meaning a plan will provide protection on both a professional and personal level.
With more to lose, it could be small to medium-sized businesses that fuel the real growth in this product over the coming years.