Q: Do you recommend personal liability insurance for chief executives and key personnel?

A: Liability insurance coverage for chief executives, such as nursing home administrators, executive directors, CEOs, presidents, directors of nursing and other top management, is typically provided by the employer.

In light of the variability for personal liability coverage for the executive, he or she should research the source of his or her current employer provided liability insurance coverage and determine the scope of such coverage. Issues to review are whether the coverage includes legal fees, or the right to choose separate legal counsel.

The initial source of information should be the organization's insurance broker. An executive who seeks greater protection against personal liability may be able to obtain supplemental coverage to expand the scope of protection, usually at one's own expense.

Coverage may vary widely. Under some insurance policies, personal liability protection for the “executive” may be covered by the general liability coverage of the employer. Under other insurance policies, personal liability coverage for the executive may exist under the employer, director and officer or professional liability policies.

The scope of coverage also can vary widely between policies. For example, coverage for employment practices, which is liability insurance intended to cover certain employment-related claims made by employees, may or may not be included as part of the organization's liability protection.

Alleged criminal acts usually are not covered. Liability protection for an executive named as a party in connection with an employment matter or regulatory issue would depend upon the scope of coverage of the relevant insurance policy.