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16th October 2017

GDPR - are you covered?

Cyber_Security_and_GDPRCyber crime is evolving so rapidly that the law is scrambling to keep up. The General Data Protection Regulation (GDPR) harmonises all the data protection laws across Europe.

The EU has finalised its new data protection legislation to close some of the loopholes that have allowed so much cyber crime to go unreported.

The new directive comes into effect from 25th May 2018. It applies to any business that holds personal data or processes data for a client firm.

It requires your firm to demonstrate you have appropriate data-processing controls in place, to notify the authorities if you have a breach and make sure you have consent for all the data you hold.
Your business can be fined up to 4% of annual global turnover or €20 Million for breaching the regulation.

All companies and firms like yours will need cover. This is already leading to increased interest in cyber insurance and without GDPR compliance, your cover may not be valid.

Key points
One of the main points in the GDPR is the way companies collect and gain consent to use a person’s information such as name, a photo, an email address, bank details, posts on social networking websites, medical information or a computer IP address.

“Consent must be clear and distinguishable from other matters and provided in an intelligible and easily accessible form, using clear and plain language. It must be as easy to withdraw consent as it is to give it. Explicit consent is required only for processing sensitive personal data - in this context, nothing short of “opt in” will suffice. However, for non-sensitive data, “unambiguous” consent will suffice.”

*Taken directly from the GDPR website.

Cyber risk insurance
Any company storing information electronically faces the very real prospect of a hacker or even an employee gaining unauthorised access to their data.

Whether information is stored on a company server, individual PC, in the cloud, or on your company website, if a breach occurs, you will need the protection that cyber security insurance can offer to counter the impact this can have on your business.

You can mitigate the risks by taking out cyber insurance. However, you would be wise to improve risk management and comply with the GDPR to keep premiums as low as possible and ensure your cover remains valid.

CLA have also teamed up with Ilicomm who can provide a complete vulnerability assessment that can reveal as yet undiagnosed problems and highlight any weaknesses. They provide a free scan, subject to qualification, so that you can test drive their service for yourself.

What does cyber insurance cover?
Cyber insurance is designed to provide the support and protection you will need from some of the financial consequences of a cyber attack and includes:
  • Mitigation of the financial impact of data leaks
  • Advice and support for your IT department
  • Managing the risk of any adverse publicity
  • Protection from third party claims against the company
  • Regulatory fines for data breaches
  • Loss of profits while recovery is taking place
  • Professional fees
  • Breach coaching
The support is provided by a cyber incident response team and policy holders can also benefit from assistance after a data breach, to help restore systems and firewalls.

If you would like to arrange a free scan from Ilicomm, please contact one of our team on 0121 321 4600.
Employers_Liability_InsuranceEmployers’ Liability insurance is compulsory for any business that employs staff. Following the recent changes to personal injury law that came into effect on 27 February 2017, you may want to consider whether you currently have the right level of cover.

While the statutory minimum is £5m and today’s policies tend to start at £10m, many customers will need a higher limit to adequately meet their needs.

You will find our 6 steps (below) for choosing Employers’ Liability a useful guide.

Rate change highlights need for review
Work-related injuries regularly involve issues of long-term care and loss of earnings. In such circumstances, lump sum settlements can be awarded with the intention of compensating claimants over a long period of time.

As these sums can be invested, a ‘discount rate’ is applied to offset prospective investment returns and ensure claimants are not under- or over-compensated.

Since 2001, this rate has been set at +2.5%, meaning settlements were reduced in expectation of positive investment returns being made.

However, on 27 February 2017, the Lord Chancellor dramatically reduced the rate to -0.75%, meaning settlements will now be increased to reflect expected negative returns.

£10m on a single claim is now plausible
The reduction in the discount rate has immediate implications for the potential size of future personal injury settlements.

The following 6 points should be considered when determining a suitable level of cover:

1. Multiple Claimants
The EL indemnity limit applies to each claim individually. However, work related injury claims can often involve multiple employees.

A claim, or series of claims arising out of a single cause, are considered to be one loss; therefore, thinking should always be framed in terms of whether a limit is sufficient to sustain multiple claimants arising from the same incident.

2. Concentration of staff
Employees are often concentrated in one area, for example in an office or on a building site. In these circumstances, one incident has the potential to harm multiple people.

The more staff concentrated in one place, the higher the limits of indemnity customers should be considering.

Individual claims are now reaching £10m. If multiple staff are potentially at risk you need to be questioning whether your cover is sufficient.

3. Nature of activities
The largest EL claims tend to involve injury as opposed to death, with claimants suffering long-term loss of earnings and the need for continuous care.

You should therefore consider whether customers are engaged in any activities with a higher risk of injury, such as working at height.

4. Hazardous locations
Certain locations are more susceptible to incidents and more likely to involve multiple people.

Common examples include offshore locations, railways and airports.

5. Inner limits
Most EL policies include some common limitations. For example, incidents arising from terrorism or offshore will typically be limited to the statutory minimum of £5m.

While these don’t impact the majority of customers, inner policy limits need to be considered depending on your company’s activities.

6. Future circumstances
EL claims can arise years after the alleged incident – in the case of work-related diseases, this can even be decades later.

Between buying a policy and a claim being settled, a lot can change to affect final settlement values.

The recent change in the personal injury discount rate is a perfect example of this. You’ll want to factor-in some contingency for prospective claims inflation.

Options for increasing limits
You should talk to your broker or insurer if you think higher limits are required.

Sometimes a more economical option is to source an excess of loss policy, which delivers the required capacity above your primary limit. Your advisor will be able to recommend the best option for your company.

How we can help
CLA’s insurance providers can also help customers prevent incidents occurring and significantly reduce the size of claims that do occur.

To find out more or discuss options for increasing limits of indemnity, please speak with one of our team.
Adding on-board CCTV to your vehicle or vehicles (if you are a fleet owner) provides many benefits to you, your business and the welfare of your employees.

FastView360-Product-Box-Mock-Up.1dad498979dc5c347165473d677db323A CCTV system can:
  • Help to prevent theft and vandalism
  • Improve vehicle safety
  • Stop fraudulent insurance claims
  • Protect your fleet and employees
  • Help young or inexperienced drivers reduce insurance premiums
  • Save you money on costly insurance claims
Cost savings and return on investment
Improvements in technology and an increase in the use of cameras in vehicles is bringing down the cost of installing mobile CCTV systems in all types of vehicles. Whether you own one vehicle or a fleet of cars, vans, HGVs, coaches or plant machinery, installing a CCTV system will improve vehicle safety and security, which could save you thousands of pounds each year.

Insurance companies are also seeing the advantages gained by their customers using on-board CCTV to help reduce claims. If a claim is made, it is much easier to establish who was at fault and settle the claim faster, keeping their administration costs to a minimum and your premiums lower. Some insurers are already offering a non fleet operators a  10% reduction in premiums to organisations using a CCTV monitoring system.

Fleet managers can view video footage instantly. This allows them to deal with incidents quickly to protect the business against fraudulent insurance claims. They can minimise disruption and costs by arranging vehicle recovery, replacement vehicles or repairs. Fastview 360 also provides the location and speed of the vehicle.

Fastview 360 superfast vehicle monitoring
CLA (Risk Solutions) has partnered with Fastview 360 to provide our clients with a CCTV system that will provide:

3G & 4G live streaming
Superfast connectivity delivers high quality, real-time remote viewing from your PC, tablet or phone.

Continuous HD recording
Clear, reliable HD recordings which are easy to review and locate incidents. No need to reformat SD cards or miss vital evidence.

GPS vehicle tracking
Built in GPS gives data about speed, direction, route and event location.
Combining exact location with the camera footage gives 100% evidence reliability.

360° view of your vehicle
HD Cameras can be installed to capture a 360° view, ensuring that every angle is covered in the event of an incident. The Hard Drive (either 1TB or 2TB as required) can accomodate up to 8 cameras if required.

Insurance benefits
The system delivers a proven reduction to loss ratio and aids mitigation of whiplash / personal injury claims. It provides concrete evidence about an incident which increases the speed of a claim settlement.

Driver focus and attention
Knowing that the system is installed improves driver focus which in turn results in fewer accidents. Drivers with smart phones can connect to cameras via wifi at no extra cost, so are able to view any night time disturbance outside the vehicle from the safety of the cab.

Products are available on a buy or lease basis. Only the highest quality camera systems are used which can be trusted to provide you with clear, reliable footage of any traffic incident minutes after it occurs.
The camera systems are easy to use and reviewing footage is simple and quick. Up to 2 months’ worth of vehicle data storage is available, so there are no additional costs for servers based at offices to store vast amounts of data that is not required.

Cameras are easy to fit and can be installed by your own workshop in around 3 hours, so you won’t have to take your vehicle/s off the road to suit outside contractors.

To find out more please contact one of our team on 0121 321 4600.
24th August 2017

Prestige cars seen in London

Prestige_car_insuranceThere are more billionaires in London than in any other city in the world. It is therefore not surprising that expensive supercars can be regularly seen on the capital’s streets.

London must be one of the most difficult cities to negotiate in any car, let alone a low slung super car trying to manoeuvre through narrow streets and road furniture. You are going to need specialist insurance to ensure you are fully covered for every eventuality.

You don’t have to be one of the world’s super-rich to own an expensive car these days, though anything over £100,000 is still going to place you in an exclusive section of the population. Prestige cars need prestige car insurance to ensure they are fully covered for a variety of insured risks.

Specialist car insurance will provide additional services over regular car insurance. For example:
  • Personal attention from expert claims handlers
  • Premium courtesy cars
  • Access to specialist repairers
Add high net worth insurance
Along with your luxury high value car or cars you will probably have an expensive home, outbuildings, jewellery and other possessions that need to be insured. It is often more cost effective to include all of these items under one insurance policy.

High net worth insurance will often include a multitude of other benefits such as travel insurance, holiday homes cover for property in the UK and abroad, antiques and collections, items stored outdoors and your children’s possessions whilst away at university.

Other benefits include a valuation service, security advice and access to approved repairers for cars, jewellery and antiques.

With so much to discuss and proper valuations to be arranged, you will need to talk to an expert who can find the most suitable cover for all your possessions.

Insurance brokers like CLA have a team of dedicated account managers to guide you through the maze of insured risks to ensure you are always protected.

 
The supreme court has ruled that the Employment Tribunal fees paid by employees, if they want to take their employer to court, are illegal.

Employee-Tribunal-FeesHow will this affect your business?
Since the introduction of Employment Tribunal fees in 2013 there has been a 79% decrease in cases being brought. ACAS conciliation service think there will be a large increase the number of cases brought in future. Their records show that 2/3rds of the employees they advised did not proceed with their claim because they would have to pay tribunal fees.

Now these fees have been dropped, you may need to consider how to improve the management of employee relationships in future, to avoid a tribunal claim.

What can you do to protect your business from a claim?
Along with reviewing your HR procedures, you should also check insurance policies to see what sort of cover you have in case one of your employees brings an Employment Tribunal claim.

On your commercial insurance policy, you need to check that you have a Legal Expenses extension. This will cover you for all types of claims including unfair dismissal, discrimination and TUPE claims.
The Legal Expenses insurance will cover your defence costs and any settlements or awards made by the court.

Alternatively, if you have Directors and Officers insurance, this will cover defence costs if you are involved in court cases with employees as well as shareholders, regulators and other organisations.

Employment tribunals can be complicated and therefore time consuming and costly. Making sure you have adequate cover to defend your case will help to mitigate the risk of a costly court case to your business.

Employees in future will have nothing to lose by making a claim against their employer even if they only have a slim chance of winning.

To discuss the best options to protect your business, please call us on 0121 321 4600.
Home-insuranceComparison sites are a great way of saving you time and money. However, cover varies widely and the cheapest quote may not give you the replacement value needed if something happens to your home or belongings.

No single comparison site covers the whole market, so it is worth checking with a couple of them to get a broader view. After checking three of the sites, you still need to go back and see if your current supplier can beat the best quote.

Comparison sites are prone to making assumptions to speed up the search process, so double check the cover before you buy as it may not be suitable for you. This all adds up to a lot of work for you. You may find it easier to use an insurance broker that can look at the whole market for you and get the best cover for the lowest price.

There are three basic types of home insurance:
Buildings insurance covers the structure of the building and the fixtures and fittings. If you have a mortgage, buildings insurance is mandatory to get your mortgage agreed.

Take care not to ‘over cover’ your buildings insurance. It’s only the rebuild value that insurers need, not the resale value. You should also consider the cost of materials, labour and architects and the cost of somewhere for you and your family to stay during the rebuild. A broker can calculate your total rebuild value for you.

Contents insurance covers your belongings. Even if you rent, you should have a contents policy, it is unlikely your landlord will cover you. Be realistic about what your belongings are worth otherwise you may be underinsured if you have to make a claim. Go through each room in your house and work out how much all your furniture, crockery, white goods, clothing, books, toys, jewellery and miscellaneous items would cost to replace.

Combined buildings and contents insurance is recommended for homeowners. Before taking out a combined policy, check the excesses, as some insurance companies have separate excesses for each area of insurance cover. This could affect your finances, if you have fire or flood damage and have to claim on your buildings and contents insurance.

If you decide to take out separate cover with different insurers, you may find they disagree over liabilities when you make a claim. An insurance broker can manage this on your behalf if you have taken out cover through them.

If you do decide to use comparison sites to save money on your home insurance, be aware that some insurance companies are charging more interest than credit cards for monthly payments. Interest charges range from 16.5% to 33.2% for monthly payments.

If you would like us to look at the whole market for you, contact us on 0121 321 4600 or request a call back.
Cyber-securityCyber security may sound like a technical problem, but as we saw recently with the NHS attacks, preventing it is a management challenge.

It starts with carrying out a risk assessment and answering, ‘how would our business cope if we came in one morning and our computers didn’t operate?’ ‘What is our backup plan and who could we rely on to help us fix it if we had an attack?’

When you have a grip on your operations, remember your business has a responsibility to staff and customers to secure the data they use in the organisation too. The Data Protection Act requires personal data is secured and used appropriately.

Why should you do this? Because the threats from cyber criminals, hackers and identity theft are very real. When you understand the extent to which your business will be affected and what it could cost you, it becomes easier to justify the resources you’ll need to put in place now to prevent it.

Computer security for small businesses should be multi-layered, using desktop security products such as anti-virus, anti-spam and firewalls, and network intrusion detection, and hardware technologies such as security tokens, disk encryption and biometric fingerprint recognition.

But above all, it is about management. Define and train your staff on a security policy, including using strong passwords that include numbers and letters; not sharing or displaying passwords; and only opening email attachments from reliable sources. Encourage your staff to use the web responsibly, and stay vigilant when outsiders are in the office. Monitor access to the network, including memory sticks and other plug-in devices, which can be used to steal company information.

Protecting your business against phishing, vishing and smishing
  • Be cautious of how much information you reveal about your company via social media platforms
  • Do not assume a caller is genuine because they know information about you or your company – fraudsters are skilled in collecting enough information to sound convincing
  • Do not open emails that you suspect could be spam
  • Never enter any personal or security information on a site accessed through a link in an email
  • Never open attachments from senders you are unsure of
  • Be cautious of callers who attempt to gain information from you – “I want to check a payment you made today”. Rather than, “I want to check a payment of £5,000 you made today in favour of XYZ Ltd”. The former may be trying to get you to divulge information that can be used against you later.
  • If you are suspicious, terminate the call
  • When ringing back to verify the contact, use your usual contact number, not one provided in the suspect correspondence
  • On sites that require you to input sensitive information, look for “https” in the website address – the “S” stands for “secure”
  • Ensure there is a padlock symbol in the URL address bar – this shows that your selection is secure
  • Remember that your bank may ask you for some information, but will never ask for your full password or PIN, provide you with details to make a payment, or request that you grant them access to your systems or PC
  • Familiarise yourself with what your bank will and won’t ask you if they wish to verify payments
Protecting your business against invoice fraud
  • Make your staff aware of this threat
  • Check notifications and invoices received carefully to see if the document looks like a counterfeit
  • Check that the email address the message comes from does not look odd, such as by ending in”.org” when it should end in “.com”.
  • Always call your supplier, using contact details you have on file (not those supplied in the message – that will be the fraudster) to confirm any changes before effecting them. Ensure that you validate the exact bank detail changes you should be making, in full
  • Consider setting up single points of contact with the companies you pay regularly
  • Consider adopting dual control procedures for any changes in payment information
  • Use leveraging technology that ensures invoices are matched with purchase orders, flagging any rogue invoices
  • Regularly conduct audits on your accounts
Cyber risk insurance
Insurance is an essential part of your cyber security strategy to help you to recover quickly after a breach and cover the costs involved such as:
  • Bringing in experts to support your team
  • Managing any negative press coverage and crisis containment
  • Third party liability
  • Repairing and restoring systems following an attack
  • Extortion costs you may have to pay following a ransomware demand
  • Legal advice
  • Business interruption costs
Vulnerability assessment – preventing an attack before it happens
CLA have partnered with cyber security specialists Ilicomm, who can offer a vulnerability assessment.

Their vulnerability assessment programme will not only reveal as yet undiagnosed problems, but will highlight weaknesses and recommend the explicit technical controls required to mitigate the risk to an acceptable level.

To find out more about cyber security and how to protect your business please call, or request a call back and one of our account executives will contact you.
According to the Zurich SME Risk Index, SME decision makers over the age of 55 are by far the most relaxed age group when it comes to the perception of overall risk in the economy.

SME-LeadersAt a glance
  • Just 39% of SME decision makers over the age of 55 see more economic risk now than 12 months ago
  • Although their younger counterparts are more concerned about the economy, they are also experiencing the most growth
  • The survey of over 1,000 SME decision makers showed differing opinions between different age groups
Less than two-fifths (39%) of this age group perceive more economic risk now than 12 months ago. This compares with more than half (54%) of SME decision makers under the age of 45 who perceive more risk now than before the Brexit referendum.

Greatest disparity of economic concern related to age
The survey of over 1,000 SME decision makers showed that the difference in opinion between different age groups was most pronounced when they were asked to assess their exposure to three particular risks: workforce challenges, market dynamics and supply chain issues.

Nearly twice as many SME decision makers under the age of 45 reported challenges to their workforce as their area of greatest concern (50%), compared with just over a quarter (26%) of over 55s. Market dynamics were a primary concern for just over a third (35%) of decision makers over the age of 55, compared with more than two fifths (42%) of those under 45.

Almost a third (32%) of SME decision makers under the age of 45 are most concerned about supply chain issues, compared to less than a fifth of over 55s (19%).

Younger business leaders see the greatest opportunity for growth
It is not all bad news for younger SME decision makers. According to the results, those under the age of 35 are busy seeking out a competitive advantage in the face of economic uncertainty.

Although they were more sceptical about the economy, they were almost twice as likely as the over 55s to see opportunities in emerging technologies.

Under 35s were also the group that saw by far the greatest opportunity in innovative areas of business. The survey shows they are almost a third more likely than over 55s to embrace new practices such as teleworking, or to incorporate mobile technology into their work habits.

This capacity to adopt new technology and working practices may explain why this group experienced by far the greatest business growth. Business leaders under the age of 35 were more than twice as likely as the over 35s to have registered significant growth in the last 12 months.
At a glance
  • Fires involving hot works often spread rapidly and cause significant property damage.
  • Our provider’s claims experience shows many hot works fires could have caused much less damage – or been avoided altogether – if the hot work permit system had been adhered to.
  • We discuss three major fires involving hot works, and identify lessons organisations can learn from them.
Hot-works-risksFires involving hot works may be rare, but when they occur, the damage to property is often substantial. Sparks can quickly spread to neighbouring buildings and cause fires that are hard to bring under control.

Investigations into the causes of hot work fires often find they could have been avoided if proper safety procedures had been observed.

Examples of three recent incidents:

Case study 1
This fire occurred during the school summer holidays. Plastic tarpaulin caught light as a gas torch was being used, and the fire spread rapidly, destroying much of the school. Subsequent investigations identified a number of failings that meant the risk of a fire occurring had not been adequately addressed.

The biggest issue in this incident was that there was no hot work permit in place to ensure the works were being managed safely.

In addition to that, materials were being stored on the roof where the works were taking place and there was no fire extinguisher on site.

The absence of a fire extinguisher may have put the contractor in breach of their Hot Works Warranty, as their insurer refused to indemnify them following the loss.

Case study 2
Hot work permits specify that for torch-applied roofing, a fire watch must remain in place for at least an hour after work has finished for the day, to ensure all sparks and embers in the site area have been extinguished.

In this incident, the contractor left the site before the one-hour fire watch period had elapsed, and it was during this time that a fire took hold. Had the contractor stayed on site, the damage could have been minimised considerably.

Although there was a hot work permit in place on this occasion, it was the contractor’s permit, and nobody from the school had oversight of it.

It may also have been possible for cold works to have been used instead, but no explanation was given as to why this option was not chosen.

Case study 3
This fire occurred at a particularly sensitive time – as students were returning to school to collect their GCSE results.

Combustible materials caught light as maintenance work was taking place on the roof of a two-storey building that housed a library and IT facilities. Although the fire was spotted quickly, it spread so rapidly that the whole of the building was destroyed.

Although there was a hot work permit in place, managed by the contractor, it didn’t achieve a great deal and appeared to be more of a box-ticking exercise.

One of the problems identified was that it was a generic permit for a larger programme of works taking place at the school; the permit wasn’t specifically created to manage the risks associated with hot works.

In addition, there was no proper oversight of the permit. It was kept in the contractor’s cabin and the only person who saw it was the individual who had issued it.

Learning lessons from hot works fires
Losses from fires involving hot works can sometimes run into millions of pounds. Indeed, in one recent claim, the loss was estimated at nearly £20m. Careful management of the associated risks is therefore essential.

One of our provider’s loss adjusters, has conducted a review into the causes of hot works fires, which found evidence of:
  • Inadequate or cursory work area inspections.
  • A failure to properly brief those carrying out hot work on the nature of the works.
  • Poor project oversight, including the way that subcontractors are managed.
Following its review, our provider’s recommended that individuals responsible for authorising hot works ensure that:
  • Less hazardous work methods have been considered.
  • Project specific work and method statements have been compiled.
  • Worker qualifications have been checked.
  • A work area risk assessment has been conducted.
  • Those carrying out the work have signed an authorisation to work as per the agreed method.
  • Periodic inspections are carried out.
  • A final check on the works area is made at the end of each working day.
For more information on managing hot works and other fire risks, please contact us.
Last year the government scrapped the dividend tax rate and introduced a 7.5% basic tax credit and a £5,000 tax-free amount. These measures resulted in an increase in the tax take from the director/shareholders who pay themselves smaller salaries with a higher level of dividends.

Because of the higher dividends, this group represents the vast majority of individuals who would breach the £5,000 dividend tax allowance.

The cut to £2,000 of the dividend tax allowance seems to confirm a continued appetite by the chancellor to raise more revenue from the same group of individuals.

It means an increase in dividend taxation of up to £225, £975 and £1,143 for basic, higher and additional rate taxpayers respectively.

Extracting Profit
What, if anything, can the director/shareholder do? There are three main profit extraction methods: salary, dividends and pensions.

If the director/shareholder does not require the extracted profits for day-to-day living expenses, they should consider extracting these profits by way of an employer pension contribution, where it will still enjoy considerable tax advantages.

The employer pension contribution will usually be deductible as a legitimate business expense, reducing the company’s corporation tax bill.

The wealth will then pass to the individual without tax deduction or charge assuming the contribution is within the various annual allowances.

Taxable dividends are still more tax-efficient than taxable salary.

Directors and officers insurance
Directors-and-Officers-InsuranceChanging the way remuneration for directors is calculated is just one example of an event that could affect your income.

Though it may not be possible to insure against changes in government policy, you can protect yourself against other claims.

A D&O policy will typically cover; claims from shareholders against the management, employment tribunal costs, Health & Safety Executive enquiry costs, legal and defence costs and damages arising from employment practices and discrimination.

Why businesses need D&O Insurance
  • Increase in claims against directors.
  • Growing litigious society.
  • World has no boundaries - risks associated with the legislation and regulation in any country in which it operates.
  • Absence of risk management making them more susceptible to errors.
  • You could lose everything including homes, possessions and investments.
  • Legal Expense cover is not enough.
  • Disputes following Family Fallouts - Smaller firms may be in family ownership.
  • Regulators are getting tougher.
Can you afford not to take out? For the price of a few cups of coffee per week this additional insurance cover could save your family home.
Business-threats-2017Allianz has produced their Risk Barometer for 2017 which identifies top three corporate perils for UK businesses.

The figures are based on the responses of more than 1,200 risk experts from 50+ countries.

At the top of the list in the UK is cyber incidents with 48%. The toughening of data protection regulation put this at the forefront of risk experts’ minds, as penalties for non-compliance will be more severe.

Second was business interruption (BI). Physical perils such as fire and explosion are top causes of BI that businesses fear most, but non-physical or non-damage causes are becoming a much bigger issue; for example, supplier failure or cyber incidents.

Macroeconomic developments moved up from sixth position last year to third.

Cyber insurance
It is no longer a case of, if your business suffers a cyber-attack, but when. Cyber-crime has moved to the top of Allianz’s barometer with hardly a week passing without the media reporting a high-profile case of hacking or ransomware attack. And this does not include smaller businesses where breaches go unreported.

Cyber insurance can provide the cover that could be the difference between the survival or bankruptcy of your business.

Business interruption insurance
Disruptions can be caused by a wide variety of risks; fire, flood or a leaking pipe. Your commercial insurance policy will cover the material losses, but if your business is forced to close following an incident, this is when business interruption insurance is invaluable.

The policy will cover loss of income following an insured incident.

Macroeconomic
It is not surprising this has moved up the Risk Barometer in 2017, with more uncertainty, driven by growing concerns over political, legal and regulatory developments globally.

Allianz possess strong underwriting and risk management capability which means they can offer cover and access to business specific risk guidance ensuring that businesses are properly protected.

To protect your business from business risks in 2017, talk to one of our account executives at CLA to find out more.
The most valuable assets of small and medium sized enterprises (SMEs) are their employees.

Interruption to the workforce – whether through employee travel disruption, injury or death – can therefore result in significant financial loss, with a greater relative impact to smaller organisations.

We look at why Personal Accident and Business Travel (PA&BT) should be viewed as an essential cover for businesses of all shapes and sizes.

Employee-business-travel-insuranceProtecting your most valuable assets
Wage roll is often an SME’s biggest expenditure, and employees its most valuable resource. However, while most businesses wouldn’t hesitate to fully insure their physical assets, many still fail to adequately protect their human resources.

“Although legally you only have to purchase third-party motor cover, most businesses will opt for fully compressive without hesitation,” says Adrian Littler, Managing Director at CLA (Risk Solutions).

“A vehicle can be easily replaced, but its driver is a complex mix of knowledge, skills and experience. Their loss can be very damaging to a business. It’s therefore hard to understand why a business would insure its vehicle but not the person driving it.”

A business interruption issue
Any business will be affected if an employee is unable to do their job for whatever reason. However, the smaller workforces of SMEs are especially susceptible to the potential business interruption and financial loss this can cause.

While larger businesses may be able to quickly find capacity elsewhere in their organisation, the loss of key personnel is likely to result in a greater disruption to an SME.

The fixed benefits provided by Personal Accident (PA) insurance can be used to offset lost revenue or cover additional expenses incurred, such as recruitment and extra staffing costs.

Business Travel (BT) will ensure major expenses are covered when something goes wrong during a business trip. Through the additional benefit of CLA’s Travel Assistance services, situations will also be resolved quickly and with minimal disruption to the insured’s business.

Satisfying your duty of care
Every employer has a legal obligation to formally risk assess their employees’ work activities and reasonably manage any red flags identified. This includes sending people on business trips, which can introduce a wide range of additional risks for SMEs to consider.

Purchasing a comprehensive BT policy is the simplest and most effective way for SMEs to evidence a commitment to health and safety compliance, and should be viewed as a minimum standard when sending employees away for business.

Don’t rely on employees’ own cover
Many SMEs do recognise the importance of PA&BT cover, but may look to rely on employees’ own coverage, often given free with bank accounts and credit cards. However, these policies are usually far more limited than a dedicated PA&BT policy, and many may exclude business travel altogether.

Protecting your customer’s reputation
In addition to demonstrating legal compliance, many SMEs also view holding adequate BT cover as a moral obligation to employees. Requiring employees to hold their own insurance, or asking them to travel with no cover at all, risks harming a business’s reputation.

For example, in autumn 2016 a lorry driver died in his cab while working in Italy. His employer collected the vehicle but told the family that they would need to fund the £22,000 to repatriate his body. The incident was widely publicised and caused the haulage firm significant reputational damage, which would have been avoided had they held even basic BT insurance.

Ensuring cover delivers on its promises
It is important to help customers appreciate the value of opting for a leading PA&BT provider, instead of simply choosing the cheapest cover.

For example, our insurers offer a £250,000 fund for use in the event of catastrophic injury. This can be drawn upon for a variety of activities, such as retraining, undertaking adjustments to the workplace and home, or employing someone to co-ordinate on-going medical needs. Professional psychological treatment is also available to families following an accidental death.

UnderinsuranceSmall and medium sized businesses need commercial insurance to cover their premises, contents, machinery and equipment. If you are sourcing your business insurance online and your only consideration is to minimise the cost of the premium, you may find that your insurance cover leaves you out of pocket if you need to make a claim.

Underinsurance is a common problem. 40% of businesses do not have enough business interruption cover to get them back on their feet (Building Cost Information Service 2012).

Rebuilding costs
The sum insured should take account of the actual rebuilding costs, not the market value. Depending on the type of property, reinstating the building back to a useable position following an incident may cost more than you think once you include materials, labour and professional fees, not to mention loss of earnings during the rebuilding period. In 25% of SME claims reviewed by the FCA, the indemnity period expired before they returned to a normal trading position (FCA thematic review of SME claims TR15/6 2015).

Business interruption insurance
The consequences of an insured incident could result in reduced or complete loss of income from your business for an unknown period. It is therefore important to check how long the indemnity period is on your insurance policy. Two years is likely to be needed for a business to fully recover to its original trading level.
These calculations can be complicated, considering all of the eventualities that could delay getting your business back up and running; for example, delays in planning permissions when rebuilding, long lead times for replacing stock or machinery and replacing customers lost due to downtime.

This is where a broker can offer their expert advice. Depending on your business circumstances they may suggest a declaration-linked, non-average basis of insurance, because it provides an uplift of 33% providing that the sum insured is correct initially and declarations are made when requested by insurers. Alternatively, a policy that is based on the estimated amount of gross-profit or revenue that you expect to earn.

Legal liability claim
Claims against your business can come from a variety of risks and insurance is designed to provide adequate levels of cover of usually £5 to £10 million. The types of cover to consider include:

  • Employers liability
  • Public and products liability
  • Directors and officers liability
  • Cyber threats
  • Environmental liability
  • Professional indemnity

You will have to assess the risk levels within your own business to determine whether the level of cover is going to be enough for your individual circumstances.

Benefits of using an insurance broker
Insurance is complex and it is not easy to assess all of the risks associated with your business and to select the most suitable insurance policy to meet your needs. Get it wrong and you could jeopardise the future of your business.

An insurance broker will be able to offer advice and select the most suitable policy for your business. They can arrange accurate valuations to ensure you have exactly the right amount of cover in place when you need it.

The Health and Safety sentencing guidelines were revised last year and became law on 1 February 2016. Senior and middle management, regardless of the type of business, need to be familiar with them — not least, because the guidelines also apply to offences committed before 1 February 2016.

Health-and-safety-lawsCourts now assess the overall seriousness of an offence based on the offender’s culpability and the risk of serious harm.

To ensure sentencing consistency across the board for Health and Safety offences, every incident now has a starting point. This provides judges with a minimum punishment that can be applied to every convicted offender.

For example, in the guidelines, the range for an organisation with a turnover between £10-50 million would have a recommended starting point for the least serious offence with medium culpability is £50,000. It could be increased to £4 million as the seriousness and culpability increases.

The criteria used to determine how serious an offence is:

Culpability
Culpability is assessed to arrive at a rating of very high, medium or low based on the likelihood of harm occurring. High ratings include ignoring concerns raised by employees or others and failing to make appropriate changes following earlier incidents. A low rating would apply when you can demonstrate significant efforts were made to address the risk but it was not sufficient on this occasion.

Harm and Risk
Harm and Risk is assessed by the court according to what could have happened rather than what did happen. Health and Safety offences are concerned with failures to manage risks and do not require proof that the offence caused actual harm. The offence is in creating a risk of harm.

This can be compounded further in the light of whether the offence was a significant cause of actual harm, high number of workers or the general public were exposed to the risk.

Contact us today on 0121 321 4600 or send your enquiry to info@clarisksolutions.co.uk if you need health and safety specific cover or would like us to put you in touch with someone that could improve your accident reporting and processes.
Penalty-for-driving-with-mobile-phoneFrom 1 March 2017, drivers caught using their mobile phone whilst driving will receive a fine of £200 and 6 penalty points on their license.

Previously the penalty was £100 and 3 penalty points with the option of taking a remedial course instead of points on their license. The remedial course will no longer be an option.

This will mean that newly qualified drivers will have their driving licences revoked if they receive the 6 points within 2 years of passing their driving test. Drivers of goods vehicles and passenger carrying vehicles with more than 9 seats could face a fine of £2,500.

Hands-free devices such as Bluetooth earpieces or hands free kits are still legal.

Definition of hands-free
So long as you only have to press a button to receive or end a call you are allowed to use a hands-free device. Multiple presses are illegal.

Therefore, you can use your mobile phone whilst driving, if it is connected to a Bluetooth earpiece or hands-free kit, providing your mobile phone is cradled on the dashboard or windscreen.

However, if you are involved in an accident whilst on the phone, you could still be prosecuted if the police think you were not in proper control of the vehicle or driving without due care and attention.

Research shows that using a hands-free device whilst driving is just as dangerous as using a hand held phone because it is still a significant distraction from driving. Drivers using a mobile phone whilst driving are four times more likely to crash, injuring or killing themselves and other people*.

Employers
As an employer, you have a duty under health and safety laws to manage the risks faced by your employees on the road and you should provide them with clear guidelines on the use of mobile phones whilst driving.

You may want to get some professional advice on assessing the risks to your employees and drawing up guidelines that will keep you safe from prosecution. Visit our website home page to find out more from our “Health and Safety Assist” partners.

*http://www.rospa.co
You may have heard about these changes in the news recently, following an announcement from The Ministry of Justice.

Ogden-Discount-TablesThe Ogden tables are used by courts to make it easier to calculate future losses in personal injury and fatal accident cases.

The tables provide a set of discount rates that make sure a severely injured person has the necessary financial security to provide for their care and loss of earnings. The discount rate is used to calculate the amount of compensation they receive to reflect the return they will earn when that money is invested.

It was announced recently, by the Lord Chancellor, that the Ogden discount rate will be reduced from 2.5% to -0.75% from 20 March 2017.

The change has been made to reflect the fall in indexed-linked gilts which are used in the calculation. However, the insurance industry believes that the system used to calculate the discount rate is flawed and does not take into account the current investment environment and the financial choices available for claimants.

The outcome of this reduction will mean that those suffering from serious injuries will receive significantly higher compensation payments than before.

The increase will affect claims costs for all types of for bodily injury in the following sectors:
  • Private and Commercial Motor
  • Motor Trade
  • Casualty (Employers Liability, Other Liability and Contractors Liability)
  • SMEs
Reducing this rate will cost the insurance industry millions of pounds and the news has already caused share prices fall. As a result, it is expected that customers will see an increase in their premiums in the future.
For most companies, purchasing insurance against loss due to accidents, fire and theft is accepted as a cost of doing business. However, these same companies often don’t consider the need for protection against what has become another significant threat to businesses – bad debt.

Bad-debt-protectionNon-payment of invoices can be a significant risk for businesses that trade on credit terms; however you can protect your business against this risk by purchasing bad debt protection. Bad debt insurance or trade credit insurance policies are tailored to your individual circumstances. The amount of credit available to your customers is based on their financial performance. Your customers are given a credit limit that you can trade up to and claim on if they are unable or unwilling to pay. The credit limit is monitored and adjusted, as and when necessary, during the lifetime of the policy.

Managing the risk
Our insurance providers offer a range of solutions that will meet the needs of small companies, medium and large businesses and multinationals. Continual monitoring and availability of information about your customers and potential customers will help your business to:
  • Grow sales into new markets and customers
  • Obtain information about the marketplace and potential clients
  • Minimise the risk of non-payment of debts
  • Access finance from lenders by providing added security
  • Improve customer relationships
Insurance against bad debt will give you the confidence to enter new markets or trading agreements that will improve the profitability of your business.

Debt collection support
Should the worst happen and you are left with a bad debt, it is important that debt collection is handled with care. Our providers have vast experience in handling debt collection with the aim of keeping both parties on good trading terms for the future.

To discuss the full range of services available and the insurance cover you need to support your business growth, please call one of our Account Managers.
 
Motor-Fleet-InsuranceBusiness vehicle fleets come in all shapes and sizes and so do the sectors covered. These can include government agencies, public transport and emergency services as well as commercial fleets.

One thing all of these organisations have in common is the need to manage their fleets as effectively as possible to minimise costs and improve driver safety for their employees.

Let’s look at some ways of achieving these efficiencies:

1. New technology
Insurance premiums can be reduced by using telematics to monitor and improve driver behaviour. This can help to reduce accidents and lower fuel consumption. Cameras in cabs can reduce fraudulent insurance claims. They can also provide evidence in accident investigations, to help speed up the claims process.

2. Driver training
Some insurers will give discounts if your drivers have been through an approved driver training course. Even without this reduction, you may still benefit from fewer accidents and a better claims record.

3. Vehicle security
Tracking devices can help reduce theft and improve recovery rates. You may also be able to get a lower insurance premium because they have been installed.

Are your vehicles fully covered?
You are confident that you have the right fleet insurance in place to cover your fleet and drivers and you are minimising your costs by using some of the above methods. However, as more businesses turn to long term leasing to finance their fleet, there is potentially a shortfall in insurance cover if one of your vehicles is written off in an accident or is stolen and it is impossible to recover.

There could be a gap between your insurer’s market valuation and what it would cost you to replace the vehicle.

This is where GAP insurance can top up the difference so you are not left out of pocket. GAP insurance would pay your finance or leasing company any shortfall in the amount owing.

Having trouble finding fleet insurance?
There is now a new and innovative insurance policy specifically aimed at businesses struggling to find suitable fleet insurance; for example, new businesses that have not yet built up a claims record or poor credit ratings and would benefit from a flexible method of paying their premium without any finance charges or credit checks.

This policy guarantees an annual premium/rate per vehicle for the entire 12 month period of insurance to help with budgeting for your fleet. You will not need a finance agreement and there is no charge for finance on the premium (subject to a £1000 minimum monthly premium). You can cancel the policy pro rata at any time during the year, if required.

Professional advice
Fleet insurance can be an expensive cost for businesses. However, with careful planning and professional advice from an experienced insurance broker you will be able to ensure you are not paying more than you need to for your fleet cover.

 
7th February 2017

High net worth insurance

Insurance for private clients with unique requirements and higher value items to protect will benefit from high net worth insurance.

High value homes and contents, including specific items of jewellery, art collections and furniture, will be covered for their full replacement value and your insurance policy can be tailored to your exact requirements.

High net worth insurance can also cover all of your other possessions, including cars, yachts and motorboats.

Insurance for high value motor vehicles
Private clients are more likely to have cars valued at over £100,000, either on the road or in storage. Vehicles valued at these sort of figures need specialist insurance cover to provide adequate protection for cars, drivers and personal belongings.

Additional services may also be required such as a dedicated claims handler to discuss repair options, availability of premium courtesy cars and legal expenses cover.

Other features include insurance for personal number plates, unlimited European use, fully comprehensive cover when driving other cars and business use as standard.

Cover can also be extended to track days to provide accidental damage and liability insurance, if required.

Yacht-High-Net-Worth-InsuranceYacht and motorboat insurance
Flexible and enhanced insurance for a broad range of vessels can be provided for private clients and includes a wider scope of cover and higher limits.

To ensure the most effective insurance policy is available to meet the needs of the modern boating community, we can offer the following:
  • Underwriting decisions made on a boat-by-boat basis.
  • Awarding customers the ability to choose more comprehensive racing cover where they need it, on top of standard liability cover.
  • Protecting customers who use their tender or dinghy away from their main vessel.
  • Removing excess to pay where deemed not at fault and third party details are available.
  • Rescue and repatriation regardless of liability for the customer or their guests for up to £50,000.
CLA (Risk Solutions) can discuss your individual insurance requirements and provide accurate valuations to ensure you are fully covered, whatever your lifestyle.

 
Have you reviewed your business insurance recently? Does it provide adequate cover to secure the future of your business should events take a turn for the worse?

Commercial-business-insuranceBusiness is constantly changing and risks need to be evaluated every year to ensure new threats to your business are covered. Fortunately, insurers are continually introducing new insurance products to meet these future business challenges. If you use an insurance broker, they should be making you aware of these new products and recommending updates to your policy. However, if you rely on simply renewing your existing insurance online without the support and advice of a broker, you may find that over a period of time, your insurance policy is insufficient to cover these new threats.

Your commercial business insurance will cover you for insured risks such as fire and theft, but you may need to check you are covered for more specific threats.

Cybercrime insurance
Statistics published by the government in 2014 stated that an estimated 81% of large companies and 60% of small businesses suffered a data breach. With an average cost of £600,000 to £1.15m for large businesses and £65,000 to £115,000 for smaller ones, cybercrime is no small problem.

Technology now connects millions of people both in business and socially due to the rise of connected devices and access to information. This trend has in turn led to a rise in the number of hackers who have the ability to launch cyber-attacks. These can arise from a number of sources both internally (unhappy staff, lost devices, poor data encryption) and externally (hackers, third party suppliers losing data).

Often clients assume cybercrime is covered under general liability. It’s not.

Liability Insurance
  • Professional indemnity
Providing professional advice as a freelance Consultant can be risky. If you were to accidently provide incorrect advice or omit to pass on relevant information, you could be liable to legal action against you or your business.

Professional Liability insurance cover is designed to meet your individual requirements and will pay for the legal costs of defending an action against you.
  • Directors and officers
Specifically developed for senior personnel and management. Directors and Officers insurance provides protection from legal action that could result in a claim against Director’s homes, possessions and investments.

Having legal expenses and PI cover in place is simply not enough, for example a PI policy does not provide cover against actions pursued by shareholders or employees.

Frequently taken out by larger companies, SME’s are sometimes slow to realise the potential benefits of a Directors and Officers policy. The fact is, a smaller business could be more vulnerable because it may have less stringent corporate governance procedures in place and therefore it is even more important to consider this cover.

Insurance against bad debt
Non-payment of your invoices can be a significant risk for small companies. You can protect your business against this risk by purchasing bad debt protection. Bad debt policies are tailored to each individual company, taking into consideration the type of industry, years in business, equity position, existing assets and liabilities, payment records and revenue.

According to “Company Check” more than half of small businesses have had to write off money owed to them as a bad debt in the past 12 months. If this was applied to the UK as a whole, the Federation of Small Businesses state that this would have affected a staggering 2.8 million companies.

In 2015 more than 7,000 trade credit insurance policies were taken out by small businesses. The Association of British Insurers figures show that £149 million was paid out, the equivalent of £3m per week to support businesses when a customer defaulted on payment.

Future protection
No one knows what insurance cover will be needed in the next few years. Change is happening at a faster rate and technology is advancing every year. One thing is certain, insurers will be developing new products to meet the demands of their customers and the first to hear about these new products will be your insurance broker.

Keep in touch with your broker regularly and they can advise you of the most suitable and affordable insurance for your company to ensure your business is protected into the future.