Management Liability Insurance

Management Liability Insurance provides legal protection for directors, senior managers and officers for claims made against them for wrongful acts they have committed or are alleged to have committed in their company roles.

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Why this cover?

Without Management Liability Insurance (also known as Directors & Officers Insurance), you run the risk of being unable to defend against actions such as disqualification from your position, civil proceedings, criminal prosecution, or meet any compensation costs that arise from an unsuccessful defence.

Benefits for your business

A management liability policy provides a comprehensive range of coverage. It's divided into three parts – Side A, Side B, and Side C. Covers will vary depending on whether you're a publicly listed company, a large company, or a small private UK company.

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Side A: individual cover provides personal protection for your directors and officers where no other indemnification exists

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Side B: company reimbursement cover provides balance sheet protection for your company where it first provides an indemnification to its directors and officers

Additional cover applicable to Publicly Listed companies

Side C: securities entity cover, provides additional balance sheet protection for your company to cover it directly for claims arising from the sale of its publicly traded shares and securtities. Please see our our Quoted companies page for more details on D&O cover for listed companies.

Additional covers applicable to Small Private UK SMEs

Smaller Private companies can purchase a Management Liability package policy that can include additional optional covers. These are sometimes also refered to as Side C covers as they protect your company directly and include Corporate Legal Liability (CLL), Employment Practices Liability (EPL), Pension Trustees Liability (PTL) and Crime/Fidelity.

Cover for large companies

For large companies, covers such as EPL, PTL & Crime may not be available under a package policy and would have to be arranged separately. Whatever your D&O requirements, Clear Insurance can assist you and tailor a policy to your specific requirements.

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Want to know more?

Find more information from our knowledgeable professionals in these downloadable documents

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Frequently asked questions

What does Management Liability insurance comprise?

Although each management liability policy will be slightly different, most will have two primary insuring clauses, Side A and Side B, with an option for a third, Side C.

Side A: Individual Cover provides personal protection for your directors and officers in their capacity where no other indemnification exists. A director’s personal liability is unlimited, so their own assets are at risk if cover is not in place.

Side B: Company Reimbursement provides balance sheet protection for your company where you provide or are legally required to indemnify your directors or officers. In the UK, a company often provides or is legally required to indemnify directors and officers.

Side C offers the following additional protection:

  • Corporate Legal Liability (CLL). This provides cover for claims made against your company rather than individual employees. However, this is not a replacement for other types of cover such as professional indemnity, employers liability or cyber liability, as the CLL section will contain restrictions in these areas.
  • Employment Practice Liability (EPL). This offers financial protection against awards of damages and defence costs arising from claims made by employees, including wrongful dismissal, harassment or allegations of discrimination.
  • Pension Trustee Liability (PTL). This provides cover where a claim arises from a wrongful act committed or allegedly committed in relation to a pension scheme.
  • Entity cover for securities claims (for listed companies). Usually written as an extension to a D&O policy, this protects the corporation from claims arising from the purchase or sale or the offer to purchase or sell the corporation's securities.
  • Crime/Fidelity. This provides limited cover for theft of your company’s funds by an employee or through social engineering. However, this does not provide the same breadth of cover as a dedicated commercial crime policy. 

How does a claims-made policy work?

Management Liability or D&O Insurance works on a claims-made basis. If a claim arises, or you become aware of a circumstance that might reasonably lead to a claim, it must be reported under the policy in force at the time you first become aware of the matter and not the policy in force at the time an alleged wrongful act took place (if the wrongful act took place years previously). For this reason, you must renew management liability insurance annually to ensure that cover remains in force for current and past actions.

Where can claims arise?

Management liability insurance claims can arise from a variety of sources, including but not limited to:

  • The company or other directors - The company or other directors can accuse you, a fellow director, of a wrongful act and bring action against you.
  • The sale of the company or its shares - Should a company be sold or sell a percentage of its shareholding, the purchasers could subsequently bring a claim against you and any other directors if they allege the directors misled or misrepresented the worth of the company and overstated its value.
  • Regulators - There are over 90 regulators in the UK, both statutory and professional. For companies that fall within their remit, any have the potential to launch an investigation into a company and/or its directors, alleging a wrongful act has taken place.
  • Shareholders - If they are different to the directors, shareholders can also bring claims against you as a director or officer in connection with any of the above examples if they feel you have not acted in the best interests of the company or been negligent, resulting in a financial loss to shareholders.

Why Clear?

Industry-recognised for being people-first, our team of specialists supports start-ups, SMEs, corporates, multinationals and individuals.

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We offer broad and bespoke sector specialist insurance solutions for peace of mind.

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We're dedicated to providing exceptional customer service to respond proactively to the needs of our clients.

Don't just take our word for it

“Phoenix Copper was delighted to renew its D&O insurance through the Clear Group. As last year the service was prompt and efficient, and they took the trouble to properly understand our business before obtaining quotes. As a result, I believe we are paying a very competitive premium within the context of the mining sector as a whole. We look forward to working with them again next year.”

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Phoenix Copper Ltd

‘We have just renewed our Directors’ and Officers’ Insurance with Clear. In what evidently is a difficult market, it has been a seamless process with first rate communication, plenty of notice and all in all, a flawless procedure.’

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Great Southern Copper Plc

“We have worked with Clear Insurance for over 10 years who act as the key insurance broker/advisor for our clients who include LSE and AIM listed companies. We have always found their advice and assistance to be of the highest standard. Recently they have been instrumental in assisting newly listed clients in acquiring D&O insurance in an increasingly challenging market without compromising in cost or coverage.”

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Westend Corporate LLP

“Clear provided us with excellent service during the renewal process for our D&O insurance. Any queries we had were answered promptly and precisely – they were with us every step of the way to ensure we had the correct product for our needs.”

Reabold Resources Plc

“Steve and the Clear Group team helped us renew our D&O insurance in a challenging insurance market for our industry. The whole process ran smoothly and I was very happy with the service provided. We will definitely be using Clear Group for our insurance needs going forwards”.

Contango Holdings Plc

“Clear have looked after our D&O insurance for several years. Despite the difficult markets they’ve done a great job on renewals, their service is excellent”

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Mobile Streams Plc

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