The past 12 months have presented some of the most difficult trading conditions and challenges to management teams. Did you know Directors and Officers that acted slowly or incorrectly in response to COVID-19 or did not have a robust Business Continuity Plan in place could be personally scrutinised by employees, shareholders, and regulators? Your business could also be held liable and therefore board engagement with Management Liability insurance has never been more important.
If you attended our webinar, you would have heard expert panellists Gary Gallen, Founder and CEO of specialist law firm rradar, and Nick McGarey, Underwriter at Beazley, mention that in both the legal and insurance sectors, they are seeing an increase in litigation and claims against businesses and senior management teams. When the Government furlough scheme and other support packages are withdrawn later in the year, it is expected that there will be a further spike in these types of claims as businesses become insolvent and/or employees are made redundant.
Our panellists have provided the following top tips to protect yourself as a Director/Officer:
- Ensure regular check-ins with your remote employees as isolation and exclusion can trigger claims against you and/or your business
- Regularly review internal and external data protection policies and procedures
- Provide data protection and cyber training to employees as 90% of all data breaches occur because of human error
- If your business is currently relying, or has relied, on Government support packages, plan your finances with proper forecasting for when these are withdrawn to ensure a timely recovery
- Continue to embrace and innovate the new way of working and offer flexibility for existing and prospective employees to avoid unfair treatment claims
- Set out health and safety measures and ensure processes are followed and clearly documented to avoid investigation by the HSE
- Have a robust business continuity plan in place
- Remember that smaller businesses are just as likely to be targeted as larger businesses
- Speak to your insurance broker about how you can mitigate these risks through careful risk management and Management Liability insurance
It is important to remember that Executive Directors, Non-Executive Directors, Shadow Directors and Officers, including those who have retired, can be held culpable for Directors and Officers claims so now is the time to consider your personal protection.
We are here to help
If you would like to discuss your personal exposures further, or for more information about Management Liability insurance and what it covers, please get in touch with our expert team.
