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Employers’ liability( EL) insurance protects your business from claims of negligence made by employees who have suffered an injury or ill health due to their work. Unlike most other types of insurance, EL is compulsory. If your business employs workers based in England, Scotland or Wales (including offshore installations or associated structures), your business must carry EL cover to avoid substantial fines.

By law, your business is required to carry at least £5 million of EL cover. However, depending on the size and the nature of your business, the minimum level of cover may not offer adequate protection. To figure out what your EL limits may be, here are six important things to consider:

1 Multiple Claimants

Your EL limit applies to each claim individually. While the minimum limit should be able to handle a single claim, it’s important to keep in mind that multiple claims can emerge from a single incident. Consider whether your EL limit can handle multiple claims at once.

2 Nature of Activities

In general, injuries – such as loss of hearing and continuous care – tend to have larger EL claims than those involving death. Review what activities your staff regularly participate in to better gauge the potential costs of an EL claim.

3 Inner Limits

Your EL policy will most likely have common limitations. In general, these limitations include incidents arising from terrorism, war or nuclear risks. Learn what your policy limitations are to better
insulate your business from risks.

4 Concentration of Staff

If your staff is concentrated in one main area or several smaller ones, you need a higher EL limit because an incident that affects one employee could easily affect them all.

5 Hazardous Locations

Some locations – such as production lines, railways and construction sites – are more susceptible to incidents. In addition, these incidents are likely to involve a greater number
of people. Identify whether you may have high-risk, hazardous locations.

6 Future Circumstances

An EL claim can be filed years or even decades after an employee has ended his or her working relationship with your business (claims occurring basis). During the time between
buying an EL policy and claim being settled, much could change to affect the final settlement values. For that reason, it’s best to annually review your EL policy.

Direct Insurance Corporate Risks: Your Cover Expert

The Team at Direct Insurance Corporate Risks is here to help you analyse your business needs and make the right cover decisions to protect your operations from unnecessary risk. Contact us today on 01277 844 360 to learn more about the services we offer to protect your business. or visit www.dicr.co.uk.

Cyber Liability Insurance

As technology becomes increasingly important for successful business operations, the value of a strong Cyber Liability Insurance policy will only continue to grow. The continued rise in the amount of information stored and transferred electronically has resulted in a remarkable increase in the potential exposures facing businesses. Regulations, such as the Data Protection Act must also be considered, because a loss of sensitive personal information may subject you to fines and sanctions from the Information Commissioner. In an age where a stolen laptop or hacked account can instantly compromise the personal data of thousands of customers or an ill-advised post on a social media site can be read by hundreds in a matter of minutes, protecting yourself from cyber liabilities is just as important as some of the more traditional exposures businesses account for in their general commercial liability policies.

Why Cyber Liability Insurance?

A traditional commercial insurance policy is extremely unlikely to protect against most cyber exposures. Standard commercial policies are written to insure against injury or physical loss and will do little, if anything, to shield you from electronic damages and the associated costs they may incur. Exposures are vast, ranging from the content you put on your website to stored customer data. Awareness of the potential cyber exposures your company faces is essential to managing risk through proper cover.

Possible exposures covered by a typical cyber policy may include:

Data breaches – Increased online consumer spending has placed more responsibility on companies to protect clients’ personal information.

Business/Network Interruption – If your primary business operations require the use of computer systems, a disaster that cripples your ability to transmit data could cause you or a third party that depends on your services, to lose potential revenue. From a server failure to a data breach, such an incident can affect your day to day operations. Time and resources that normally would have gone elsewhere will need to be directed towards the problem which could result in further losses. This is especially important as denial of service attacks by hackers have been on the rise. Such attacks block access to certain websites by either rerouting traffic to a different site or overloading an organisations server.

Intellectual property rights – Your company’s online presence, whether it be through a corporate website, blogs or social media, opens you up to some of the same exposures faced by publishers. This can include libel, copyright or trademark infringement and defamation, among other things.

Damages to a third-party system – If an email sent from your server has a virus that crashes the system of a customer or the software your company distributes fails, resulting in a loss for a third party, you could be held liable for the damages.

System Failure – A natural disaster, malicious activity or fire could all cause physical damages that could result in data or code loss.

Cyber Extortion – Hackers can hijack websites, networks and stored data, denying access to you or your customers. They often demand money to restore your systems to working order. This can cause a temporary loss of revenue plus generate costs associated with paying the hacker’s demands or rebuilding if damage is done.

Cyber Liability Insurance is specifically designed to address the risks that come with using modern technology; risks that other types of business liability cover simply won’t. The level of cover your business needs is based on your individual operations and can vary depending on your range of exposure. It is extremely important to work with a broker that can identify your areas of risk so a policy can be tailored to fit your unique situation.

Direct Insurance Corporate Risks: Your Cover Expert As reliance on technology continues to increase, new exposures continue to emerge. As your business grows, make sure your cyber liability cover grows with it. Direct Insurance Corporate Risks is here to help you analyse your needs and make the right cover decisions to protect your operations from unnecessary risk. Contact us today on 01277 844 360 or email the team info@direct-ins.co.uk

How Safety Programmes Can Lower Costs

If you could save your company money, improve productivity and increase employee morale, would you? Demonstrating the value of safety to management is often a challenge because the return on investment (ROI) can be cumbersome to measure. Your goal in measuring safety is to balance your investment vs. the return expected. Where do you begin?

Measuring Safety Costs

There are many different approaches to measuring the cost of safety, and the way you do so depends on your goal. Defining your goal helps you to determine what costs to track and how complex your tracking will be.

For example, you may want to capture certain data simply to determine what costs to build into the price of your service, or you may want to track your company’s total cost of safety to show increased profitability, which would include more specific data collection like safety wages and benefits, operational costs and insurance costs.

Since measuring can be time consuming, general cost formulas are available. If it is important for your organisation to measure safety as it relates to profitability, more accurate tracking should be done. For measuring data, safety costs can be divided into two categories:

  1. Direct (hard) costs, which include:
  • Safety wages
  • Operational costs
  • Insurance premiums and/or legal fees
  • Accidents and incidents
  • Fines and/or penalties
  1. Indirect (soft) costs, which go beyond those recorded on paper, such as:
  • Accident investigation
  • Repairing damaged property
  • Administrative expenses
  • Worker stress in the aftermath of an accident resulting in lost productivity, low employee morale and increased absenteeism
  • Training and compensating replacement workers
  • Poor reputation, which translates to difficulty attracting skilled workers and lost business share

When calculating soft costs, minor accidents costs are about four times greater than direct costs, and serious accidents are about 10 to 15 times greater. According to the International Risk Management Institute, just the act of measuring costs will drive improvement. In theory, those providing the data become more aware of the costs and begin managing them. This supports the common business belief that what gets measured gets managed. And, as costs go down, what gets rewarded gets repeated.

The Value of Safety

Studies indicate that for every £1 invested in effective safety programmes, you can save £4 to £6 as illnesses, injuries and fatalities decline. With a good safety programme in place, your costs will naturally decrease. It is important to determine what costs to measure to establish benchmarks, which can then be used to demonstrate the value of safety over time.

Also, keep in mind that your total cost of safety is just one part of managing your total cost of risk. When safety is managed and monitored, it can also help drive down your total cost of risk.

Considering the statistics, safety experts believe that there is direct correlation between safety and a company’s profit. We are committed to helping you establish a strong health and safety programme that protects both your workers and your bottom line.

Contact the insurance professionals at RHA Insurance Services to learn more about our value added services. Call us on 0203 960 2944 or email us at enquiries@rhainsuranceservices.uk.net or alternatively, visit www.rhainsuranceservices.uk.net to learn more about our tailored insurance schemes.

Trade Credit Insurance

The risk of debtor insolvency is an inherent part of owning a business. Sometimes your customers simply do not or cannot pay you—it is unavoidable, but not disastrous. Your business can survive such a loss by purchasing a trade credit insurance policy.

Trade credit insurance, or credit insurance, provides your business with protection against the failure of your customers to pay their debts and substantial delays in receiving their payments. What may seem catastrophic at first is completely bearable with adequate trade credit cover. Learn how to overcome the non-payment of customers’ debts with the following overview of trade credit insurance.

Reining in Customers

Purchasing trade credit insurance can help save your business from crippling bad debt. As globalisation continues to lengthen businesses’ supply chains and expand their customer bases beyond national borders, debtors and creditors continue to grow further apart. This makes it easier to lose track of your customers and presents more obstacles for their payments, such as government restrictions or political instability abroad. Trade credit insurance can protect against the various risks of trading across borders.

Not receiving customers’ payments on time—or at all—could be fatal for your business, but trade credit insurance helps transfer that risk. Policies typically cover about 90 per cent of customers’ outstanding debts, so the failure of one large customer or multiple small ones will not overwhelm your organisation.

There are two main types of trade credit insurance:

  • Whole turnover covers the insured’s entire book of debtors, providing the maximum level of protection against bad debt.
  • Specific account applies only to those accounts the insured feels are at risk. These policies may be subject to an increased premium, and are riskier than whole turnover cover, since the insured may choose incorrectly and fail to insure an account that defaults.

Common Extensions

In order to be effective, trade credit insurance policies should be tailored to your business and list of debtors. Insurers typically offer extensions to provide a bespoke policy, including:

  • Pre-delivery work in progress, which safeguards against the insured’s financial losses due to a customer becoming insolvent before work is completed but after the insured has incurred costs such as material or labour. If a project goes bust, the insured is not left to shoulder the debt and pick up the pieces.
  • Supplier default, which protects against financial losses from a supplier going out of business. This includes the costs associated with finding new suppliers, the loss of advance payments to the defunct supplier and any possible fines or damages for late delivery.

Calculating Premium Costs

Insurers assess your business and determine your premium by considering your business’ risk, the amount of turnover you want to insure, your customer demographic, the overall state of your industry and your success or failure in past credit management. Your premium will likely increase if your customers are concentrated in one or two accounts rather than several. If you prefer a specific account policy, the insurer will investigate the credit worthiness of each individual account when calculating your premium.

Make sure to implement and maintain a stringent credit control policy. Any flexibility or instability in how your business administers and sustains credit will translate to higher premiums.

Depending on which cover you choose, you can arrange a policy for a fixed period of 12 months or for the duration of a specific customer’s contract.

Bespoke is Best

A clunky, ill-fitting trade credit policy will not benefit your business. Make sure your insurer offers bespoke cover that fits your business’ needs. Trade credit insurance is a small, specialised field that requires careful risk assessment. A precise assessment will create an effective insurance policy that keeps you above water when your customers go under. Contact Direct Insurance Corporate Risks at 01277 844 360 today for more information on wielding bespoke insurance policies to shield your business from risk.