Corporate legal liability insurance

Corporate legal liability is a type of insurance within our management liability portfolio. It provides cover for claims or investigations against a company over claims of wrongdoing such as an actual or alleged act, breach of fiduciary or statutory duty.

Examples of potential corporate legal liability claims and investigations may include, but are not limited to:

• Breaches of duty or trust
• Breaches of warranty or contract
• Failure to comply with tax guidelines
• Pollution claims brought by shareholders.

These claims or investigations could come from several sources, such as tax inspections, claims from a competitor, or investigations from a regulator.

Please note: Corporate legal liability insurance would not cover you if you’re a sole trader or your business is a partnership.

Corporate legal liability at Hiscox sits within our management liability insurance portfolio, which deals with claims relating to the management of a company or organisation. Other types of management liability insurance cover include:

• Directors’ and officers’ (D&O) insurance
• Trustees and individual liability insurance
• Employment practices liability insurance
• Professional and legal liability insurance.

How are these management liability covers different?  

It depends on who the claim is made against, or the type of organisation you are. For example, CLL protects the business itself against claims and investigations, whereas D&O insurance protects senior managers or other leaders at the business when claims are made against them personally.  

Get a quote for corporate legal liability insurance. Contact us on 0808 2736 570
Mon-Fri, 9am-5pm. 

You may feel you need corporate legal liability insurance if you’re registered as a limited company or LLP, because this means your business has become its own legal entity and can have claims made against it.  

As its own legal entity, a limited company is legally separate from its owners. The business itself can face legal action (external link) – hence the importance of legal liability insurance to protect your limited company or LLP.  

Your level of prosecution risk will depend on different factors. For example, the industry you work in and the products you provide.

Although CLL cover isn’t a legal requirement in the UK, you may feel it’s helpful to include in your business insurance policy. Claims or investigations can come from several sources. Whether from a health and safety investigation, competitor claim, or an inspection from a regulator.

Further examples include:

• A plumbing company facing an HMRC tax investigation
• The competitor of a marketing and media company claiming mismanagement when a cyber attack occurred
• A retail business facing a Health and Safety Executive investigation following the accidental death of a member of the public on their premises.
• A management consultancy suffering a loss when a member of staff stole funds from their bank account 

The amount of corporate legal liability cover you’ll need will likely depend on the nature of your business and the risk type you may encounter.

The size of your company can also be significant. For instance, for a large company dealing with high-value accounts, claims and investigations may also be of higher financial value. If this is true for your business, setting higher indemnity limits could prove reassuring.

At Hiscox, we can cover you for corporate legal liability from £100,000 to £10 million. We work with you to tailor your insurance policy depending on your sector and organisation. 

Hiscox corporate legal liability (CLL) insurance can help cover your business for claims and/or investigations arising from:

• Breaches of duty, trust, negligence or warranty of authority
• Breaches of corporate manslaughter and/or health and safety laws  
• Failure to comply with tax guidelines.

We will also pay for:

• Investigations under corporate manslaughter law and/or health and safety law
• Defence costs for claims arising from pollution  
• Costs of making a compulsory notification to an official body
• Investigation mitigation costs
• Financial losses from employee dishonesty (other than directors, partners or officers).  

Please refer to the policy documents for the full details of inclusions and exclusions of this cover. Policy documents are available when purchasing online. You can also contact our customer services team for more information. 

Hiscox corporate legal liability (CLL) insurance does not cover claims, losses or investigations arising from:

• Dishonest or fraudulent acts against or suffered by you where the act was committed or condoned by you or someone relevant
• Defamation
• Requirements to clean up pollution
• Acts occurring after you have been acquired or taken over
• Wrongful employment termination, breach of employment contract or mistreatment of employees, current or former
• Product manufacture, sale, supply, installation or maintenance
• Public offering of securities
• Patent, trademark, copyright, registered design or intellectual property infringements
• Breaches of professional duty
• Failure to provide professional services
• Bodily injury or property damage, other than in relation to a breach of corporate manslaughter law and/or health and safety law.  

Please refer to the policy documents for the full details of inclusions and exclusions of this cover. Policy documents are available when purchasing online. You can also contact our customer services team for more information.