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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.

 
New-Year-ResolutionA New Year and a fresh start, but put aside your personal New Year resolutions and consider setting some for your business. Research from AXA found that 26% of small British businesses set targets and resolutions for their company at this time of year. Not a high percentage considering how important future planning is to a business.

Often business owners find themselves working in the business rather than on it, being dragged into the day-to-day challenges that present themselves and often losing sight of the bigger picture. The start of a new year brings an ideal opportunity to assess the direction of your business and your achievements against your current Business Plan.

New Year Resolution suggestions:

1. Make a Plan
In order to keep your business on course, a robust Business Plan needs to be developed. Start off with a clear direction and ensure that you refer to the plan at regular intervals, adapting it as and when required. Don’t forget to share it with everyone in the business so that you are all working towards a common goal.

2. Make a stand
Gaining competitive advantage is getting more difficult so having a clear Unique Selling Proposition (USP) is crucial. Take time to clearly define what makes your company and offering different from that of your competitors.   Then communicate your message via multiple channels to maximise coverage.

3. Make Communication Count
Communication is a two way process. Devise a feedback process this year, if you haven’t already got one, to gain feedback from your customers. No one likes to receive negative comments, but it is better for you to be told, than your potential customers. It will provide you with an opportunity to work on your weaknesses and boast about your strengths.

4. Make Time
Take the time to engage with what is going on around you. Listen out for new opportunities, make new contacts, read business books, talk to your staff and be open to new ideas.

5. Secure your business
Finally, check your insurance policies to ensure they are still up to date and insurance values are adequate. As your business grows you will need to review your insurance cover to ensure you are not underinsured if you have to make a claim.

For a FREE review of your insurance cover with no obligation to purchase, call one of our Account Managers.
At a glance
  • The use of telematics is now well established, with clear evidence that it can reduce fleet risk and generate cost savings
  • While private motorists and large fleets are increasingly exploring these benefits, the uptake of telematics remains limited in the wider commercial fleet market
  • We look at how to overcome perceived barriers to telematics use and begin realising its potential
Telematics-1Telematics has become a hot topic in fleet risk management over recent years, with insurers, individuals and businesses increasingly exploring its potential.

With telematics technologies now well established on our roads, and mounting evidence for their benefits, some are even urging the government to make their use mandatory for high-risk drivers.

However, while telematics continues to gain traction with private motorists and businesses with large fleet risks, such as hauliers, its uptake remains limited across the wider commercial fleet market.

We look at the reasons for this limited uptake, and consider how you can help customers overcome any perceived barriers and start benefiting from telematics technology.

Cost of technology
When telematics was first utilised by the risk management community, many solutions were prohibitively expensive for the majority of customers, often requiring costly retrofits or annual service contracts. This made it difficult to justify to the wider commercial fleet market.

However, with telematics now a widespread, mass-market technology, the range of solutions has grown exponentially alongside significant reductions in cost.

Private motorists and commercial risk managers now have access to a variety of simple, cost-effective solutions to meet their needs. For example, free smartphone apps can be installed on drivers’ personal devices, giving employers the ability to remotely monitor and analyse the data captured.
Cost is therefore no longer a barrier to customers exploring the potential benefits of telematics for their organisation.

Lack of driver incentive
One of the biggest barriers to commercial fleets generating benefits from telematics, is the different incentives provided for private motorists and fleet drivers.

A private motorist knows that their telematics device could ultimately save them money via fuel savings, a reduction in collision risk and lower motor insurance premiums.

But a fleet driver does not have the same direct monetary incentive. An improvement in their driving behaviour may benefit their employer, but it is unlikely to result in a direct benefit to them.
In commercial situations, telematics must therefore be accompanied by something else to fill that void and incentivise better driver behaviour. There are a variety of methods to achieve this, from regular meetings with drivers to discuss the data captured, to offering financial incentives that reward good behaviours.

The key, however, is to have an element of line manager control where telematics data is regularly monitored and acted upon to drive improvements in behaviour.

Too difficult to manage
The importance of line manager control is in itself a perceived barrier to telematics. Many organisations will consider the task overly complex or fear that it will require too many resources.

However, unlike older telematics solutions – which may have required risk managers to analyse raw data themselves and identify trends – the latest applications typically make it very easy to understand and act upon the information captured.

Most applications will now allow managers to set certain parameters and receive notifications if drivers stray beyond them – for example, a push notification if a driver exceeds a posted speed limit or corners too fast.

Some applications will now even help incentivise drivers via ‘gamification’ of the data – for example, through leader boards, where employees are rewarded for positive behaviours and penalised for negative ones.

How we can help
Fleets that use telematics effectively often experience year-on-year improvements in their collision and claims rates, as well as lower fuel consumption.

However, while most organisations appreciate the benefits that telematics could generate, the barriers to effective implementation and use are frequently perceived as being too great.

We are happy to offer assistance to help overcome any perceived barriers and enable more organisations to start benefiting from telematics solutions.

For more information on telematics and a range of other fleet risk management tools, please contact one of our Account Managers.
In early 2016 the discovery of a piece of plastic in a Snickers bar in Germany triggered a recall that saw manufacturer Mars withdraw its chocolate bars from the shelves of retailers across a staggering 55 countries.

On investigation, it transpired that the offending piece of plastic was part of manufacturing machinery originating from its factory in the Netherlands. Even though only a single foreign object was found it was enough to cause a health and safety recall costing the confectionary giant millions of pounds of lost sales.

Most companies plan for a loss scenario of a couple of day’s product manufacture that may be affected before the problem is identified, however in the case of Mars it was six months! It can be argued that smaller companies do not have multiple manufacturing sites and therefore the risk is somewhat minimised.  But should an incident arise, it is not just the cost of the products that have to be recalled but the negative publicity that comes with it and possible legal costs.

The challenges are not limited to incidents occurring within the supply chain. There is of course the threat of damage to property with nearly 10% of the largest fire losses in the UK being in the food and drink sector (Allianz), of that material damage is usually around 50% and 27% is the business interruption loss. As well as the risk of fire, the threat of flooding continues to affect businesses across the UK.

Before you open the factory doors, it would be wise to check you have all of the adequate insurance policies in place and for the correct amounts of cover.

At CLA Risk Solutions we are on hand to offer free advice and a review of your insurance cover to ensure that you obtain the most relevant insurance policies for your business.

Commercial-Insurance-1For example, CLA can offer a comprehensive policy designed to run in conjunction with your Commercial Combined or other primary insurance. Designed for UK registered private companies with a turnover of up to £50m and charities, clubs or associations with up to £2m income.

Cover includes:
  • Directors’ and Officers’ or Trustees’ Liability up to £5,000,000 limit any one claim on a worldwide jurisdiction basis
  • Company Legal Liability up to £5,000,000 limit any one claim
  • Pollution clean-up costs included up to £25,000
  • Cyber Liability included
  • Employee Dishonesty cover included for £100,000 limit any one period of insurance
  • Employment Practices Liability up to £5,000,000 limit any one claim as an optional section
  • Professional Negligence cover included (for charities and associations only)
  • Access to Employment, Legal and Regulatory advice
  • Crisis public relations advice helpline
Call one of our Account Managers for more information.
11th November 2016

Health and Safety Assist

New sentencing guidelines for health and safety offences came into force on the 1st February 2016. Tough penalties can now be imposed on companies that breach health and safety laws and organisations need to ensure they have taken every precaution to minimise the risks to their employees.

Heavy fines running into millions of pounds and even prison sentences can be imposed on companies and individuals; therefore anything you can do to make managing health and safety as effective as possible within your organisation is going to help you to sleep easier at night.

This is where CLA’s “Health and Safety Assist” can help. We have teamed up with a specialist Health and Safety provider to give you access to an online portal. This secure online resource provides access to your own safety management hub. The portal will help you manage all of the documents necessary to meet your health and safety responsibilities and comply with the relevant standards for your business sector.

Making safety a habit
The portal will provide access to all of the documents you need in a secure and easy to manage area ensuring no more lost paperwork or missed deadlines for your annual report and risk assessments. Our providers will remind you of anything that needs to be done which will save you time and money. There is no need to book an appointment that may interfere with your busy schedule. They will keep in touch with you at a time that suits your needs and will be ready to answer any questions that you may have. The system will keep all information (conversations, activities, documents, tasks, events) in one secure place to ensure your business is taken care of at every level.

Health-and-Safety-AssistThe portal provides:
  • Document storage
  • Action plans
  • Sector related documents
  • Personal calendar
  • Task management and discussions
  • Live chat
  • Audit trail
  • Secure access

Better management = lower premiums
By using our portal you will be able to demonstrate that you have a system in place for the management of your documentation and risk assessments. The system also provides bespoke solutions for your business and a raft of other resources. By working with our provider you will improve your processes and minimise your exposure to risks. Their experienced consultants will be on hand to offer advice and generate a bespoke action plan for your business.

Joining “Health and Safety Assist” and working with our provider will not just improve your organisation’s health and safety management. Using this information, CLA will be able to source the most suitable liability insurance policy, at a reduced insurance premium because insurers will be confident that health and safety standards are being managed effectively.

Contact one of our Account Managers for more information about this service.
 
18th October 2016

Smart home security

At a glance
  • Surveys suggest half of us are planning to buy a smart home device during the next 12 months
  • Devices available and what you should consider before buying one
  • Discounts on home insurance may be available from some insurers due to improved home security
Security is a key driver in smart home technology
While only one-fifth of consumers already own a smart home device, almost half are considering doing so within the next 12 months. Surveys show that home security is the prime motivation for nearly two-thirds of people considering buying a smart device.

Home-automation-securityAdvantages of smart home security devices
The devices currently available range from smart locks, which allow a user to lock or unlock doors remotely via their smartphone, to smart cameras that can stream and record video footage from inside or outside a property.

The most obvious advantage of such devices is that they offer new ways to protect your property that traditional devices cannot match.

However, smart home devices also have the power to positively change people’s behaviour.
Research suggests that 95% of alarms in the UK are false alarms. Hence, house alarms often get ignored and over time, this changes the behaviour of homeowners, as many will eventually decide there is no point switching their house alarm on.

Using the new technology, security devices can detect sound or movement that are unusual and send a notification to a user’s smartphone. They can then decide whether to sound an alarm, call the police or take no action if they are satisfied nothing untoward is going on.

What are the risks of smart home devices?
There could be a number of reasons why many people have yet to invest in smart home technologies:
  • Cost
  • Concerns devices will be complicated to install
  • Fears over privacy
  • Hacking and cyber security concerns
In relation to cyber security, although there have been isolated cases where hackers have managed to take control of webcams, baby monitors and other smart home devices, theft of personal data is a greater risk.

With 70% of IoT (Internet of Things) devices suspected to have cyber security vulnerabilities, it’s important you select smart devices with high cyber security standards.

To find out what you can do to reduce your insurance premiums by installing smart home devices, call one of our Account Managers or fill in our enquiry form.
 
Directors and Officers Insurance

It all started back in 1929 with the Wall Street crash, when it was felt that many directors involved could face legal action from angry shareholders. Increasingly popular in the USA, Directors and Officers insurance over the past few years has started to emerge in the UK too. It is a common misconception that legal expenses or professional indemnity insurance provide all the cover needed, however this cover is not always adequate.

Directors-and-Officers-InsuranceEven if you have been involved in the running of a limited liability company for years without a problem, your personal assets could still be at risk. FACT: It is not just companies that are at risk, any director, officer or employee carrying out supervisory functions can face unlimited personal liability for actions they take on behalf of the company.

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 unfortunately 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 for them to consider cover.

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.

With tougher stances from the regulators the risk of investigation and fines is on the increase. In 2013 fines from the Financial Conduct Authority totalled £474m, a 50% increase on the £312m its predecessor, the FSA handed out in the previous year. A D&O policy may not cover the fine, but behind every investigation there is a significant drain on management time, legal defence expenses and potential brand damage.

Why businesses need Directors and Officers cover
  • Increase in claims - Regardless of the size of the company, they are increasingly seen as targets for criticism.
  • Growing litigious society - Employees, shareholders, investors and creditors know their rights and are far more likely to take action against a company and its directors.
  • World has no boundaries - With an increase in global business, it leaves directors exposed to risks associated with the legislation and regulation in any country in which it operates.
  • Absence of risk management - Often smaller firms can’t afford adequate risk management systems which make them more susceptible to errors.
  • You could lose everything! - D&O claims pose a threat to directors’ personal assets including their homes, possessions and investments.
  • Legal Expense cover is not enough - This should not be seen as an alternative to D&O as limits tend to be lower and provide defence costs only rather than damages as well.
  • Family Fallouts - Smaller firms may be in family ownership and therefore disputes can lead to shareholder rifts and greater exposure to litigation claims amongst relatives.
  • Regulators are getting tougher - The risk of investigations are increasing and so are the associated fines. Failing to have D&O cover could be a costly mistake.
 
At a glance
  • Phishing attacks result in victims being tricked into clicking on a fraudulent email link or attachment
  • While companies are investing heavily in technology to fight these attacks, human error makes all businesses vulnerable to phishing
Phishing attacks in particular require a combination of an effective human response and a technological solution.

Here, we examine why phishing can be a huge problem and the strategies that can be deployed to fight off phishing attacks.

phishingThe scale of the phishing threat
Successful phishing attacks can give hackers access to a treasure trove of data, which they can use for financial gain.

There have been numerous high-profile attacks in the UK, including one that led to the theft of £1.2 million from hundreds of students, and the recent £20 million Dridex Trojan attacks, which targeted British banks and government agencies.

Phishing attacks work because they target human vulnerabilities that exist in every business.
Janet Roberts, Zurich’s Head of Security Awareness, Group Information Security, says: “Cyber criminals rely on the possibility of human error when planning a phishing attack. Perhaps the person is in a hurry while reviewing emails and does not check before clicking on a link. Or perhaps they have not been educated about phishing and the risks it poses.

“Criminals may try to infiltrate a firewall or other system, but a company with robust technology can often prevent these types of attacks. Companies are investing heavily in preventative technology, which is good, but they need to remember that without educating their people, employees remain a weak and obvious target.”

Fighting off phishing attacks requires a three-pronged approach: detection, reporting and technology.

1. How to detect a phishing email
Many fraudulent emails share common characteristics, such as:

A generic greeting, e.g. “Dear customer” – in most organisations where people interact via email, they would be addressed by their name
  • A threat to take action – banks, credit card companies or internet service providers wouldn’t notify somebody that their account was in danger via an email threat, but cyber criminals might
  • Requests for personal information – e.g. passwords, PINs or log-in details
  • Spelling/grammatical errors – cyber attacks originate from all over the world and English is often not the attackers’ first language. Although some criminals are now employing proof-readers to check for spelling errors. Other grammatical or syntactical errors may give cause for suspicion
  • Addresses that don’t match up – one of the most basic, but important, phishing defences is to hover the mouse over a link (without clicking). The website URL will then appear on screen. Comparing this URL with the typed address will give a good indication as to whether the link is genuine.
2. Importance of reporting phishing attacks
Companies should establish clear mechanisms for staff to report suspicious emails to their IT department straightaway.

If an employee has clicked on a link they suspect contains malware (unwanted/hostile software), prompt reporting will help the company to stop it from spreading. Even if the employee has not clicked on the suspicious link or attachment, reporting the incident will allow the company to investigate whether any other employees may have done so. The time it takes to detect and respond to an attack is critical.

Verizon’s 2015 Data Breach Investigations Report highlights how, in a majority of cases (60%), attackers are able to compromise an organisation within minutes of a successful data breach.
One study found that while 80% of companies have a process for employees to report phishing, more than half (52%) of companies say their staff report fewer than a quarter of the suspicious emails they receive.

It is therefore vital that companies foster an environment in which employees understand their role in preventing phishing, and that employees are updated regularly on the latest phishing lures being used.

3. Importance of regular updating of technology
Cyber criminals are continually adapting their methods to make their phishing lures harder to spot. Therefore, while a human line of defence can complement a technological solution, it cannot replace it.

As cyber security company Proofpoint observes in The Human Factor 2015 report on phishing: “While an important tool, user education cannot be the last line of defence: organisations should deploy automated defences capable of detecting and blocking threats that do not look or behave like previously known threats.”

Proofpoint’s research highlights that on average, one in 25 malicious messages is clicked on, and that this ratio remains almost exactly the same regardless of an organisation’s size or how many malicious messages it receives.

Cyber criminals realise if they keep attacking, they will find a soft target sooner or later. However, companies that have built a human line of defence to back up their IT solutions will be best placed to minimise the risk of becoming the criminals’ next victim.

 
Tenancy-agreement-form1. Tenancy Agreement
Update your tenancy agreement and check the special conditions and side notices you wish to include. Pay particular attention to the prescribed information and deposit conditions.

2. References & ID/file Check
Ensure that you have carried out thorough checks on your tenant before they move in and that the
person signing and moving in is the same person you have referenced, by checking their identity and their immigration status.

3. Prepare Your Service Details
Ensure you have proof of service all of the items you need to service at the beginning of a tenancy, such as gas certificate, smoke alarms check, How to Rent guide, Energy Performance Certificate, and any local constraints tenants need to follow such as parking restrictions or use of shared areas.

To protect yourself in the future, ask your tenant to sign your checklist to show that you have carried out all of the required steps as laid out by the De-regulation Bill. Without these you may not be able to issue a Section 21 and seek a possession order.

4. Have Landlords Insurance
Landlords' insurance isn't compulsory, but some lenders make it a requirement of taking out a buy-to-let
mortgage and it protects you for risks not covered under domestic policies. A complete landlords’ policy should include buildings insurance, accidental damage cover and financial protection against loss of rent.

5. Subscribe to a Legal Resource and Learn
Managing your own property saves on agency fees, but puts the risk on you. By not issuing a ‘How to Rent’ guide can mean you cannot evict the tenant using a Section 21.

Not issuing a gas certificate or checking smoke alarms, could lead to prosecution, so make sure you are
aware of ALL the things you need to do when you start a tenancy to protect YOU and reserve your rights as a landlord.