Insurance in MOtion – Privacy and sexual harassment impose increased D & O risks

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Increased risks for directors and officers are not just arising from the external environment- companies need to manage the internal risks arising from privacy breaches and sexual misconduct. This has ramifications for corporates and their insurers.

Management liability specialist Kevin LaCroix has pointed to US trends as forewarning of what can be expected in the Australian market which has seen this issue give rise to an increased number of claims, both individual and as a basis for class actions.

Mandatory data breach reporting means more information publicly available in relation to data breaches, and the figures show the majority of those breaches arise from employee error. Improved training could certainly help reduce these instances.

The Me Too movement has raised awareness of sexual harassment in the workplace, with associated increases in complaint numbers. Obligations to provide a safe workplace clearly make this a potential management liability.

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