In light of the ongoing COVID-19 crisis, we are issuing this Newsletter to provide additional advice to our clients on insurance matters arising.
In an earlier email, we discussed the impact on travel insurance and business interruption cover to those who hold this cover. In this edition, we discuss how other forms of insurance cover are affected and actions organisations can take to protect themselves.
Cyber Insurers have reported a ‘spike’ in claims for data breaches and incidence of hacking, as companies have put in place arrangements for staff to access their work IT systems from home. Insurers stress the need to avoid insecure Virtual Private Networks (ie those without adequate encryption or multi-factor authentication) and remote access apps. The most common types of claim being seen by Cyber insurers are hackers installing ransomware and theft of funds.
Insurers are also seeing a rise in ‘social engineering’ incidents – criminals taking advantage of remote working arrangements to fake identities, tricking staff into paying forged invoices. Companies and charities should ensure staff are trained to query requests for payments and to check bank details on invoices to avoid being caught-out.
If not already arranged, it is recommended that organisations consider taking Cyber insurance to cover losses and liabilities associated with hacking and data breaches. Your regular Insurance Services Surrey adviser will be able to assist in arranging this.
Directors’ & Officers’ Liability/Charity Management Liability Insurance
Despite the hard work and best endeavours of executives, some individuals may face legal claims of negligence in making decisions at this time or actions by regulators or statutory bodies. To this end, we recommend that consideration is given to adequate levels of insurance to protect individuals and the organisation. It is anticipated that the availability of such cover may reduce and that rates may increase as the number of claims rises. If such cover is not currently selected, your usual Insurance Services Surrey contact will be able to advise.
In theory, these policies can also be extended to include legal actions against the organisation by employees/candidates for an alleged breach of employment law, although the availability of such cover is becoming more scarce. Certainly, once redundancies are planned, taking cover to guard against resultant legal claims is not possible. Organisations will want to consider investigating the availability of such insurance before redundancy plans become a consideration.
Employees returning to work
As employees return to the workplace, organisations will be vulnerable to claims that the health of staff members was compromised by a lack of adequate social distancing and hygiene measures. Claims for compensation for illness are likely to increase. This may lead to the cost of Employers Liability insurance rising in the medium term and the availability of cover being limited for organisations which have suffered such allegations. Firms and charities are urged to carefully plan arrangements to keep staff apart and to shield those who are vulnerable (or look after vulnerable household members).
It is important to communicate the practical measures you are taking to staff on a regular basis to help reassure them that their health, well-being and safety is your top priority. Make sure employees are clear about what procedure they should follow if they begin to feel unwell, both in the workplace and at home.
In particular, organisations will need to consider: consulting and following recommended Government guidelines:Government advice and guidance conducting a deep clean prior to reopening and review of cleaning arrangement e.g. ensuring all phones/keyboards etc are wiped daily with anti-viral cleaner implementing and signposting social distancing requirements for staff and visitors utilising PPE, shielding, additional hand washing facilities and restricted access to keep everyone safe staff who travel or visit other company premises may also need additional equipment or briefing. a contingency plan if employees display symptoms e.g temporarily suspend trading and/or conduct a deep clean ensuring all employees are aware of any changes to the safe system of work and that changes are documented has equipment/machinery been idle for a period of time? What needs to be done to ensure safe operation? documenting additional staff re-training, e.g. re-orientation or reinduction process for returning staff. signposting staff to mental health and well-being support and resources. The risks to people’s health from this pandemic are psychological as well as physical.
Motor Fleet Insurance
Some Motor Fleet insurers are allowing cover on vehicles to be ‘laid-up’ if the road tax on these cars or vans has been revoked and the vehicle is now subject to a Statutory Off-Road Notice. Your Insurance Services Surrey contact will be able to advise on the best way to do this.
Where goods have been in transit by sea since before lock-down procedures began, it is possible that these will need to be stored in temporary warehouses whilst deliveries are held-up. It is important that we are aware where this is the case, as the insurers will need to amend the policy to ensure continued cover.
Private Motor Insurance
We are heartened that so many people are volunteering at this time or taking on temporary work to help out. It is important to ensure that, if you are using your own car for such purposes, your private car insurance extends to include use for this work so as to remain road legal and to avoid uninsured claims.
Please do remember to let us know if: your premises are currently unoccupied. Most policies include a requirement to notify insurers and to carry out certain precautions if no-one is regularly going to be present during your normal business hours for an extended period. If any security at your premises is likely to be compromised, particularly the response to alarm systems you need cover for business equipment away from the premises. your business or charity is offering different services from normal (an example would be a restaurant now offering take-away food instead). Organisations will also need to ensure that appropriate health and safety risk assessments are undertaken regarding home-working and if children are to be brought into the workplace as a result of school closures. Staff working from home may also need to inform their own home insurers that this is the case. This is especially important if they are likely to receive business visitors.
We do understand that these are challenging times and we are available to answer your insurance questions.
The Insurance Services Surrey Team
PO Box 1533
Insurance Services Surrey is a trading name of Insurance Services (Surrey) Ltd, authorised and regulated by the Financial Conduct Authority.
The information in this newsletter was compiled on 11th May 2020