Business insurance is essential to protecting not only your business, but all your employees, your data and your equipment. This has arguably even greater importance when employees are working remotely and you have less visibility on some of the variables that can cause harm, says Janthana Kaenprakhamroy
For the past year many employees have found themselves working from home. This new setup may have reduced commuting hours and offered some increased flexibility over working patterns, but it is clear that this year has placed increased pressure on staff and businesses alike. The increased acceptance of remote working looks set to continue long after the restrictions on office work are lifted as organisations begin to recognise the many benefits, especially as they have already invested time and money in setting up their employees to work at home.
As businesses look to make this a more permanent fixture, alongside their considerations for technology and communication channels they should also be taking a look at their current business insurance packages. Whether home insurance policies required extensions or were able to cater for working activities has been widely discussed, but business insurance policies such as Employers’ Liability (also known as Worker’s Compensation in the US), Contents Insurance (also known as Commercial Property Insurance in the US) and Cyber Insurance also warrant consideration. Evaluating any changes or additional cover that may be required will protect staff, managers and equipment when working remotely.
Within this article I am going to evaluate some of the key considerations when working from home and how these could impact upon the insurance cover needed.
Protecting employees
One of your fundamental duties as an employer is to protect the wellbeing of your employees. Having the necessary safeguards in place to create a safe working environment is essential to preventing injury to your staff and protecting yourself should any accidents occur. Whilst you do not have the same visibility when staff are working from home and liability risks are arguably lower, you still have a duty of care when they are doing their contracted work. If you do not fulfil your legal obligations, you are leaving yourself open to employees bringing cases against you for both short and long term conditions.
The necessary shift towards home working at the beginning of 2020 was rapid, but now that it seems to have become a fundamental practice for many businesses managers should be conducting assessments of the suitability of workstations in the safest way possible. As mentioned by ACAS, if it is not possible employees should be equipped with information on how to create a safe working environment and instructed to conduct a self-assessment. This should cover things such as the height and support of chairs, height of desks and the requirement for raised laptop stands. Suitable equipment should be provided by employers that minimises risks of back problems or RSI in the future. If an employee develops an issue in the years to come and it can be traced back to your lack of care, it will cost you, just the same as if you have not put in place appropriate measures to mitigate Covid-19 risks if returning to the office.
Mental wellbeing should also be an area of concern. The increased pressure and stress could culminate in burnout for some employees and if you have not put measures in place to safeguard their wellbeing, this could leave your organisation vulnerable too. Employees should be encouraged to communicate with their managers if their situation changes, if they have concerns or if their environment becomes unsafe and health and safety recommendations should extend to regular screen breaks and informing them of entitlements to sick days and annual leave.
In the UK, Employers’ Liability insurance is a legal requirement for all companies that have at least one employee or two directors. It covers costs associated with physical injuries to your employees that they may suffer during their employment. At least £5 million worth of cover is a legal requirement in the UK under The Employers’ Liability Act 1969.
Ensuring you have a suitable policy in place is essential to both protecting your employees and protecting yourself as a business. It is likely we are going to see employees bringing claims in the future against companies that did not suitably protect against Covid-19 or the potential mental and physical injuries of working at home. Therefore, you should be focused on both having policies in place, conducting risk assessments on working set ups and checking in on mental wellbeing.
Protecting data
Working from home means that data you may have previously stored on internal computers is now being hosted on a cloud to allow for home access. Similarly, many employees are now operating on new technologies where it may be harder to spot phishing emails and they are now relying on their home internet to provide them with a secure connection.
In fact in May 2020 it was reported that there was an increase in ‘malicious email traffic’ that was aimed at home workers and a Hayes Connor Solicitors survey found that of respondents ‘One in five had received no training for handling company data, GDPR or cyber security’. With this in mind, it becomes all the more important to consider Cyber Insurance cover to protect yourself against threats and breaches.
Even if you are not an IT based company, you still have employees on computers that require protection. Cyber Insurance can protect you from accident data breaches, hacking of customer data or passing a virus onto a client’s computer by providing monitoring, computer security and potential legal and forensic services as required.
Protecting equipment
When equipment is all stored within one location, it is arguably easier to protect as you know where it is and only those with keys or codes have access to that equipment. When working from home there are potentially more variables for damage, perhaps from less effective home security, more people with access to devices or more avenues for accidental damage. This is given further importance by the fact that many home insurance policies do not cover working from home and employees are unlikely to have included equipment belonging to the business within their personal policy.
It is therefore essential to check over any contents policies to see if this covers equipment when it is outside of the registered address so you are protected against loss, threat and damage. If you do not have this or your policy does not cover equipment elsewhere, certainly consider this if you have specialist equipment that would be a considerable to be replaced.
Protecting against legal disputes
Unfortunately you may find yourself in an employment dispute and it is here that you are likely to need some support, be that to cover the costs of the legal fees or access to a legal helpline. One option is Legal Expenses Insurance that can cover legal costs arising from Employment disputes, Tax investigations and Compliance and regulation, to name just a few. This cover would also provide you with a legal document library including employment contracts and HR notices for example, but there are some areas which are not covered here, such as failure to register for VAT.
Employment practices liability insurance is a similar product available to cover legal expenses, however this specifically caters to employment law and disputes. Unlike Legal Expenses, Employment Practices Liability does not have a ‘prospect of success’ clause. As highlighted by Insurance Business UK:
‘There is an absolute duty on the insurer to pay defence costs arising from a wrongful employment practice and indemnify a reasonable out-of-court settlement, employment tribunal compensatory award or damages awarded by a court.’
It may not be a case of needing one or the other, but typically Legal Expenses tends to cover the more general needs of smaller businesses whereas Employment Practices Liability is preferable for larger businesses who already have their own in-house HR support.
Conclusion
Business insurance is essential to protecting not only your business, but all your employees, your data and your equipment. This has arguably even greater importance when employees are working remotely and you have less visibility on some of the variables that can cause harm.
To ensure you are fully protected should anything arise, take a look at your current policies and see if they apply to employees working from home or equipment outside of the office. Perhaps a specialist broker could help you work out the cover required.
Without this cover you are leaving yourself exposed to harm, particularly as claims can be made retroactively on certain insurance products, like Employers’ Liability. Adequate insurance protection is a must when embedding remote working into your business practices.
Janthana Kaenprakhamroy is the CEO of Tapoly, winner of Insurance Provider of the Year at the British Small Business Awards 2018. Tapoly is an award-winning digital managing general agent (MGA) for SMEs and freelancers, and provides underwriting services, distribution, and an end to end white labelled SAAS (software as a service) solution connecting insurers with their distribution partners.
Janthana was listed by Forbes as number six of the Top 100 Women Founders to watch and is among the Top Ten Insurtech Female Influencers according to The Insurance Institute. Janthana is a chartered accountant and former internal audit director at top-tier investment banks. More information can be found at https://www.tapoly.com/
