PERSONAL AND COMPANY LIABILITY

Individuals who are members of companies may, through their actions, create liabilities – both on the companies and on themselves.  This is true also of individuals who work for partnerships.

Insurance policies will generally be taken out by companies or partnerships rather than by individuals.  These policies, which protect the companies or partnerships, will not necessarily automatically provide the same protection to the members of the companies and partnerships – whether they be principals, employees or owners. 

For this reason, some professional organisations advise and/or require their members to be expressly covered by the insurances taken out by the organisations for whom they work.  Even where this is in place, the insurance cover is unlikely to extend to protect individuals when acting in their own capacity rather than on behalf of their company, etc.

Therefore, professionals who give advice not in pursuit of a commission given to the organisation with which they work may expose themselves to liabilities for which the insurance taken out by the company or partnership offers no protection.