Lisa Carter, Managing Director - Clear Insurance
In today's complex business landscape, recognising operational risks and implementing effective risk transfer strategies is vital for protecting directors and their organisations.
Identifying Operational Risks
Operational risks may be internal or external, such as compliance failures, system breakdowns, fraud, product recall, and even natural disasters. By understanding your risks, you can seek insurance solutions tailored to address specific vulnerabilities.
Types of Insurance to Consider
1. Directors and Officers (D&O) Insurance: Protects directors and officers from personal liability for decisions made while managing the company. For example, if a shareholder claims that the board failed in its fiduciary duties, D&O insurance can cover legal fees and settlements.
2. General Liability Insurance: Protects businesses from claims related to property damage and personal injury. For example, if a client slips and falls on business premises, general liability insurance can cover medical expenses and legal claims.
3. Professional Liability Insurance: Also known as errors and omissions insurance, protects against claims alleging negligence in professional services. For example, if a consultant gives negligent advice leading to a client's financial losses, professional liability insurance can cover the resulting legal costs.
4. Cyber Liability Insurance: Protects businesses from losses related to data breaches and cyberattacks. Companies experiencing a data breach often face significant regulatory fines and customer compensation costs, which cyber liability insurance helps mitigate.
5. Business Interruption Insurance: Compensates your business for lost income due to operational disruptions, such as natural disasters or equipment breakdowns. For instance, if a fire damages an office, causing weeks of operational downtime, this insurance cover can address lost revenue and the expenses incurred to maintain operations.
What can you do if you have concerns about your insurance program?
If you have concerns, contact your insurance adviser for clarity on your insurance needs. Clear Insurance offers a no-obligation risk and insurance review resulting in a gap analysis report that equips you with the insights needed to make informed decisions. Reach out to Lisa Carter at lisa.carter@clearinsurance.com.au or call 1300 721 132.
General Advice Warning: This advice is general and does not consider your objectives, financial situation or needs. Consider whether the advice is appropriate for your personal circumstances. Before making any decisions, obtain and read the relevant product disclosure statement. Clear Insurance Pty Ltd. ABN. 41 601 916 689. AFSL No. 548953.
