Professional Liability Insurance - Why You Need It
FEDS Professional Liability Insurance gives you the freedom to manage. For more articles like this one, read "Yesterday's Headlines, Today's Coverage" in the bottom left corner on the FEDS homepage.
Each year, managers in the federal government are under pressure to squeeze increasing efficiency and performance out of what seems to be an ever-shrinking workforce and budget. In this environment, one of the best ways for you as a federal manager to give yourself the peace of mind necessary to carry out your duties is to purchase a professional liability insurance (PLI) policy.
For a low annual premium (as little as $145 a year after agency reimbursement), managers and supervisors can feel secure in their future, knowing that they have legal protections in the event of a catastrophic civil lawsuit or administrative action. Although professional liability insurance (PLI) is important for all federal employees, for federal managers and supervisors it is a necessity. In today’s political climate, federal managers are exposed to complaints and actions by employees, fellow managers, members of the public, special interest groups and sometimes even politically motivated officials. With agency budgets under enormous pressure and public scrutiny of federal employees at an all-time high, any misstep real or imagined can result in serious disciplinary and financial consequences. The huge exposure that federal managers have to civil, administrative, and criminal liability is the main reason why Congress has mandated the agency reimbursement for all managers and supervisors—it is a clear sign that government officials consider the jobs of federal managers to be “high-risk” in terms of professional liability.
All PLI policies will provide the policy holder with three distinct types of protection: administrative, civil, and criminal. Administrative complaints brought upon by subordinate employees, co-workers, members of the public or some other entity often lead to EEO, OIG, OPR, OSC, Congressional or other management directed investigations and/or proposed disciplinary actions requiring the need to defend yourself. Assuming these matters will be automatically dismissed or defended against by your agency would be a mistake. Federal executives and managers are most at risk for administrative and disciplinary matters. These actions (which include EEO complaints, management investigations, OIG/OSC investigations, and whistleblower or ethics complaints, among others) are unfortunately becoming more and more prevalent in the federal workforce. Whether it is a misunderstood directive, an employee unhappy with being passed over for a promotion, or the seemingly ubiquitous “problem employee,” the impetus for an EEO complaint can be ever-present in the workplace. For a federal manager, oftentimes facing EEO complaints and investigations is simply the “cost of doing business” and performing your job. In these situations, having a professional liability insurance policy will provide you with an attorney to prepare you for the agency administration or investigative process, attend the investigative interview with you, and defend you against any resulting disciplinary action, from the agency level all the way up to the MSPB.
Federal managers are also vulnerable, albeit to a lesser degree, to civil lawsuits filed against them. These suits are typically referred to as Bivens Actions, Constitutional Torts or Personal Capacity Lawsuits. All federal employees can be sued personally by private persons or other entities for alleged violations of an individual's constitutional and common law rights. To understand civil exposures, you need to understand these three things: (1) You can be sued, (2) DOJ can deny representation, and (3) you can be liable for a judgment whether or not DOJ defends - and - if DOJ or your personal attorney loses and the government denies indemnification, you are liable for the judgment of damages. In the event of a personal capacity lawsuit filed against you, your professional liability insurance company will provide you with an attorney to defend yourself, as well as (depending on which PLI carrier you choose) indemnity protection to help prevent devastating financial losses.
While criminal charges against you are not as likely as administrative allegations, a PLI policy still provides legal representation in this area. Should you face any criminal charges resulting from you performing your duties as a federal law enforcement officer, your PLI provider would make sure you have a legal representative to provide an effective defense.
For a manager or supervisor in the federal government, a professional liability insurance policy is a “must have” tool to defend your career, reputation, and financial security. Given the Congressional mandate for agency reimbursement, it is clear that those in the government consider PLI a necessity for federal managers.
While this article has concentrated on outlining the benefits and wisdom of having a PLI policy in general, next month’s Manager Matters column will focus on which PLI policy will best suit your needs.
For more information on your specific exposures now, how professional liability insurance protects, or how the FEDS program differs from other insurance programs, please visit the FEDS website and choose the Executive and Managers tab. For more articles like this one, read "Yesterday's Headlines, Today's Coverage" in the bottom left corner on the FEDS homepage.
Posted in Manager Matters