Ben Butler
Ben Butler

The sleep-easy insurance policy

April 10, 2024

Can an insurance policy really help you sleep better?

Ask the director who’s dealing with an unfair dismissal claim and has lost his house. Or the Officer who’s been accused of sexual discrimination. Or the MD who’s facing the devastating effects of a health and safety claim. If you’re a business owner, there are certain gut-wrenching scenarios that make you feel uneasy just thinking about them.


Legal claims against directors have increased in recent years. In fact, some £13.6bn is lost by SMEs annually for failing to take care of their legal issues*. And although it’s frustrating and sad to see a growing culture of blame and claims, protecting yourself and your business properly is the only way to make sure you’re not constantly worrying about what you read in the latest business news.

Worrying about these claims is what stops you sacking someone who’s incompetent (because you’re worried about the fallout). It’s what stops you promoting the best person for the job (because you fear the repercussions from others in your business). And it’s what might be keeping you awake at night (even if you don’t realise it).

In this blog post we’re going to shine a light on those monsters under the bed so you can sleep a little easier:


1) Monster #1 – As a company director, you can be held personally liable

If you’re a director of your company, your personal liability is unlimited. Which essentially means that if someone accuses you of committing a wrongful act, your personal assets are at risk (even if you didn’t do it). Because even if you’re not guilty, legal defence costs can add up.


2) Monster #2 – Your business is more likely to be taken to an employment tribunal than have a fire

Employment tribunals are worryingly common, but lots of businesses are more likely to have Commercial Property Insurance than Management Liability Insurance. If this is you, you’re certainly not alone as it’s very common for directors to consider physical assets first. In fact, it’s one of the reasons we’re trying to raise awareness of management liability risk.


3) Monster #3 – A cyber-attack can stab you in the back

It sounds like the stuff of science fiction but if a cyber-attack happens, you could be held personally liable. That’s because, as a director, you’re responsible for making sure you’ve put adequate systems and controls in place to manage your company data. If you haven’t and there’s an attack, customers, investors and regulators could make a claim against you.


46% of businesses have experienced a cyber breach or attack in the last 12 months (Cyber security Breaches Survey 2020, DCMS)


4) Monster #4 – The ESG monster (sounds like the BFG but nowhere near as friendly)

Activists, investors, regulators and customers all expect you to be more environmentally minded and with this comes additional responsibility (and liability).  This could be as serious as criminal proceedings brought by the Environment Agency, or as simple as pollution charges. With more focus on how companies address climate change, this is the monster that’s still creeping about in the shadows but will soon be in the limelight.


The sleep-inducing properties of Management Liability Insurance

All of these monsters sound pretty scary especially with claims on the rise. So we’re on a mission to share the sleep-inducing properties of Management Liability Insurance (also known as Directors & Officers Insurance) which protects your directors, management team and business against allegations of wrongdoing.

The good news? Management Liability Insurance combines three areas of risk in one policy:

  • Claims against your company
  • Claims against a company director
  • Costs incurred at an employment tribunal


“I’ve always described the MLP policy as “The Sleep Easy” policy because when I ask my clients what keeps them up at night, business and employees are normally top of the list. The cost of legal advice and fees are increasing, as well as the time to resolve cases, so it’s a minefield to navigate a claim by yourself.”  Gareth Roberts, Client Adviser for Macbeth


We believe so strongly in Management Liability Insurance that we’d recommend it even if you don’t arrange it through Macbeth.

Discover your risk score and learn how to risk less, and visit our dedicated Management Liability Insurance page for further information.


*The financial impact of SMEs’ failure to take care of their Legal Business, Lawbite, 2017

Want to sleep better? Speak to our team about Management Liability Insurance and how to risk less.

Call us on 0118 916 5480

Want to sleep better? Speak to our team about Management Liability Insurance and how to risk less.

Call us on 0118 916 5480

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