If you hold a senior leadership position in a company that specialises in design, projects and equipment for the food service, catering and hospitality industry, your responsibilities will likely expose you to various risks.

These risks include claims made against you from anyone you come into contact with during your employment; employees, clients, creditors, regulators and competitors.

You may be personally liable for defending these claims, which can be extremely costly. Directors and officers liability insurance will protect you from personal liabilities in the face of legal action.

What are the risks?

Despite following the appropriate company procedures, things can go wrong, and claims can arise for various reasons. Some examples include:

• – A wrong decision relating to financial aspects of the business, such as future investments or employee pension schemes.
• – Issues with health and safety practices that result in an accident in the workplace.
• – Employee rights, including those relating to unfair dismissal.
• – Intellectual property issues or claims of poaching competitor’s clients.

Even if the claim is false, you’ll still have to pay the legal fees to defend yourself.

Why do claims happen?

Claims can happen for a variety of reasons, such as:

• – regulatory investigation
• – mismanagement or negligence
• – libel or slander
• – breach of duty of trust
• – unfair dismissal or discrimination
• – anti-competitive behaviour.

What does director and officers insurance cover?

Also known as management liability insurance, directors and officers liability insurance typically covers activities that can be described as a “wrongful act”. This could be any of the following actually or allegedly committed or attempted by a director:

• – error
• – falsification
• – misleading statement
• – action or omission
• – negligence or breach of duty.

Investigations relating to a claim could severely damage your professional reputation, even if your name is cleared. This insurance will cover the cost of public relations to manage adverse publicity.

Here to help

From employee or public health and safety concerns to criminal proceedings, there are many risks directors need to manage and protect against.

If you want to understand if directors and officers insurance is right for you, contact Marsh Commercial’s Insurance experts.

Depending on your role and responsibilities, they can advise you on the level of cover you need. Contact Leah Gregory on 07385 482545 or email leah.gregory@marshcommercial.co.uk.

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