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100 Insurance & Business Articles to Enjoy

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Building Cladding & Fire Risk

Insurers back national cladding probe after UK disaster

 

Australian insurers are backing a national survey of buildings using flammable cladding in the wake of the devastating blaze that killed at least 58 people in London’s Grenfell Tower.

Experts have warned the disaster could be replicated in Australia, and the Insurance Council of Australia (ICA) says a national survey is needed “before tragedy occurs”.

Witnesses say last week’s fire in the inner-London suburb of Kensington raced up the tower block’s exterior, fuelled by combustible cladding that was added to the 1970s structure last year.

The cladding is thought to be similar to that blamed for the rapid spread of a major blaze at the Lacrosse apartments in Melbourne’s Docklands in 2014.

Victorian Planning Minister Richard Wynne moved last week to reassure residents that Australia’s strong building codes mean a similar tragedy would not occur here.

But experts disagree, saying the prevalence of flammable cladding here remains a serious threat to life.

Following the Lacrosse fire, the Victorian Building Authority (VBA) audited 170 Melbourne CBD buildings and found 51% featured non-compliant cladding.

Many of these buildings were deemed safe to occupy, and even the Lacrosse building retains its original cladding as legal arguments continue over who should pay to remove it.

The number of buildings with such cladding in other cities – including Sydney – is unknown, although an audit of Adelaide buildings has been announced since the Grenfell disaster.

One of the arguments in Australia’s favour is that buildings more than 25 metres tall must have sprinkler systems installed.

The 24-storey, 70-metre Grenfell Tower, which was insured by Norwegian insurer Protector Forsikring, had no sprinklers and only one stairway exit for 120 homes.

But FM Global Australian Operations Chief Engineer Andre Mierzwa advises that while sprinkler systems are a huge benefit, “they can be overtaxed”.

“I took a walk down the [Melbourne] Docklands and at least 50% of buildings have this [combustible cladding] on them,” he said.

“We still need to have a close look at these buildings, and we are not out of the woods yet for a similar sort of fire.”

FM Global, which deals only in the commercial space, carries out its own testing of materials and risk assessments.

But Mr Mierzwa believes most insurers of residential apartments would not know which type of cladding has been used on buildings.

“They would have to do a lot of digging to find out what the product is,” he said.

He also believes a claim could be denied if a building is discovered following a fire to be non-compliant with the Building Code of Australia (BCA) and it can be argued the owner “deliberately withheld information”.

He believes the pressure will now be on to remove cladding in Melbourne and across the country.

“But it will cost millions and millions of dollars,” he said.

Fire Protection Association Australia CEO Scott Williams advises the London tragedy could easily be repeated here.

“The BCA is a minimum code, and when a building doesn’t reach that we have a problem,” he said.

“Any building that has this combustible cladding poses a very strong risk that what happened in London could happen here.”

He says there is a clear discipline issue within the building industry. “There is unscrupulous behaviour and substitution of product to save a few dollars.

“There needs to be greater auditing, and greater enforcement with consequences for individuals who breach the rules.”

He believes cladding could be just the tip of the iceberg.

“What about the thousands of other products going into buildings? Are we talking about widespread non-compliance, and [is] our building stock actually in a terrible condition? We just don’t know.

“We have a lot of work to do. The cladding has to come off, whatever the cost, and every building has to be compliant with the code.”

ICA spokesman Campbell Fuller says Australian insurers are “acutely aware” of the dangers of inappropriate materials and the need for strict compliance with the BCA.

“Many insurers inspect high-rise buildings prior to agreeing to underwrite them, and also rely on compliance testing carried out by certified professionals experienced in the management of fire safety codes,” he said.

“If insurers become aware of new information that alters the risk profile of a building, they may choose to reassess their premiums accordingly. Evidence that an insured building is non-compliant with building codes has the potential to complicate the claims process.

“If policyholders become aware of information that materially alters the level of risk they face, they are obliged to notify their insurer.

“Insurers would support a national approach to surveying buildings that use these products to ensure any issues can be identified and rectified by owners before tragedy occurs.”

Article reproduced from Insurance News

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Cyber Attacks Revealed

A recent survey has revealed that 90% of Australian organisations have faced some sort of cybersecurity compromise during the 2015-16 financial year, highlighting the need for cyber insurance to avoid massive financial losses from a cyber attack. The survey by the Australian Cyber Security Centre (ACSC) polled 113 organisations, 90% of which claimed to have experienced some form of attempted or successful cybersecurity compromise. Full article found in Risk Management Magazine

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Virtual Reality Shaping General Insurance

Virtual Reality (VR) could shape the future of general insurance says third party claims expert Peter Tomkins.

“Traditionally, the biggest challenge insurers face is understanding risk. Modern technology has come a long way to address this need – insurers are now using car monitors to understand driving behaviour , and Fitbits to understand a client’s health . VR is another powerful tool that an insurer can use to fill in their understanding of a risk profile,” says Tomkins, General Manager, Specialty Markets at Gallagher Bassett.

Full article found at Insurance and Risk 

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Professional Indemnity Analysed

Professional indemnity insurance provides you, your business and your employees, with protection for financial claims made against you or your business. This type of cover is designed for employees or businesses that give advice and/or provide a service to individuals or businesses, and are looking for a form of protection against legal claims not covered under general insurance policies. Professional indemnity insurance does not generally provide cover for criminal prosecution and a number of other liabilities recognised under criminal law, though other forms of insurance may cover these.

Do I actually need professional indemnity insurance?

Any worker that provides another person advice and/or a service of skilful nature that has required previous training for an established discipline is recognised as a professional.

There is legislation in place in Australia to regulate the provision of services by professionals. Despite this, mistakes can and do happen in the workplace and will often lead to the professional’s client seeking compensation for damages. A professional can still be liable for losses even if the mistake was not a result of their own negligence. Professional indemnity insurance ensures your business can continue to operate despite having to cover legal costs.

Do you own your own business or provide a service?

Most Australian workers are covered under their employer’s liability cover, however any worker carrying out any consulting or contracting work must ensure that they have adequate and appropriate professional indemnity insurance in place. All professionals should take the time to review the current cover they have in place and assess whether it is worth them taking out additional cover to ensure they are protected from claims against errors or omissions they have made in the provision of their professional activities.

Professions that generally require professional indemnity insurance

As mentioned previously, anyone that provides advice or a service to another in an established discipline is a potential candidate for professional indemnity insurance. Some typical professions that will usually require professional indemnity insurance include:

  • Consultants
    IT professionals
    Accountants
    Architects and designers
    BAS Agents
    Engineers
    Finance and mortgage brokers
    Nurses
    Real Estate Agents
    Recruitment Consultants
    Beauty, Massage and Physiotherapists
    Psychologists
    Travel Agents and Tour Operators
    Veterinarians

Many professions work closely with Australian governing bodies to determine an appropriate level of professional indemnity cover that is required for their profession. Regulations around what types of insurance are mandatory for different industries can vary from state to state. It might be best to consult with your industry body to get a clear understanding of the specific types of cover you require.

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Does work that is supervised require professional indemnity insurance?

Just because the work is supervised by a principal of the company is no reason for workers to think that they may not be liable to defend claims for negligence. In the event that they end up in court on claims for negligence, the cost of legal fees and advice alone could quickly amount to tens of thousands of dollars. This may only be the start of a potential financial nightmare if they are found to be liable.

Do contract workers need professional indemnity insurance?

There have been cases in Australia where contract workers and consultant have still been found to be negligent despite carrying out duties given by principal with whom they were employed. Many companies will now require contract workers to have both professional indemnity insurance and public liability cover in place. If the work the contract worker performs causes damages, they are liable for claims from the employing company.

What does professional indemnity insurance actually cover?

Essentially, professional indemnity is designed to cover the policyholder for any legal costs that may be incurred if a client files a claim. Any ensuing compensation that may be required to be paid to the client from the individual or business is also covered. Comprehensive policies will offer cover for claims from clients for financial loss, bodily harm or damage to property due to errors in the provision of the service.

Typical civil liabilities covered under a policy include:

  • Breach of duty. Indemnifies the insured for claims arising out of breach of duties including confidentiality, privacy or fiduciary duty
  • Consumer protection liability. Claims for compensation resulting from violation of statutory duty
  • Contractual liability. Claims breach of contractual agreement that can be enforced in court
  • Breach of Competition and Consumer Act and Fair Trading Acts. Indemnifies policyholder for claims arising for breach of Competition and Consumer Act and Fair Trading Acts (Australia and New Zealand)
  • Intellectual property. Claims made for the infringement of the use of intellectual property. Most policies will require for the act to be unintentional and for the purpose of the provision of the service
  • Unintentional defamation. Unintentional publication of words believed to be defamatory of the client if the insured made the comments innocently
  • Contractors or consultants. Liability arising from services provided by contractors or consultants. Indemnity will only provide cover for the policyholder and will not extend to the contractors and/or consultants that have provided the service
  • Libel or slander: Liability arising from libel or slander by the insured to the client provided that it was committed during the provision of their professional service and that it was unintentional
  • Loss of documents. Loss or damage to the clients documents during the provision of the insured’s service
    Misleading and deceptive conduct. Claims arising where the policyholder has engaged in conduct that is misleading or deceptive in the provision of their service as outlined under the ASIC Act 2001
  • Compensation for court appearance. In the event that the policyholder’s legal advisers require the principal or employee of the policyholder’s business to appear in court, the policyholder will be provided with compensation equal to their daily salary to a maximum amount
  • Claims investigations costs. Compensation for costs incurred to investigate claims paid in addition to the maximum limit provided under the policy for Australian and New Zealand jurisdictions
  • Dishonesty of employees. Policyholder will be compensated for liability in respect of claims made that were the result of dishonest, fraudulent, criminal or malicious acts or omission by an employee of the insured during the provision of their service
  • Inquiry costs. Compensation for costs arising out of inquiries into the insured’s liability
  • Joint venture liability. Compensation arising from the insured’s participation in any joint-venture related to their professional service
  • Legal consultation costs. Compensation for costs incurred from legal consultation to the policyholder in the event of a claim
  • Public relations expenses. Indemnifies the policyholder for adverse public relations expenses that arise during the policy period
  • Spouse liability. In the event that a claim is made against the policyholders spouse, the claim will be treated as the liability of the insured’s
  • Extension of claim period. In the event that a claim is made against the insured up to a specified number of days following the expiry of the policy, the insured will still remain covered under the policy

The conditions of the cover features listed above will each have their own set of conditions for compensation to be paid which may vary greatly between policies. It is crucial that anyone looking to take out cover is absolutely clear on the requirements for a claim to be paid and the maximum compensation that they stand to receive under claim.

 

Who Is Covered Under A Professional Indemnity Insurance Policy?

Professional indemnity insurance must be able to provide adequate cover for the insured to be protected from any civil liabilities that may arise from the provision of their service either from themselves or by others working on their behalf. This cover must be broad enough to extend to past, current and future work. Professional indemnity policies will generally provide cover for:

  • Each party identified in the policy schedule. This may include people, firms or incorporated bodies
    Past, present and future principals
  • Any entity that is created or under the control of the insured that performs a professional service during the policy period
  • Past, present and future employees of the insured. This may extend to include volunteer workers and students
  • Liability of the principal from previous business conducted for the same service that is listed under the current schedule
  • Entities that have previously traded with the business insured under the policy
  • Subsidiary companies of the insured
  • The insured’s spouse
  • Legal entities of the insured
  • Some (but not all) policies may also include cover for:
  • Joint venture liability
  • Liability for professional service that has been provided by an agent or consultant

How is professional indemnity insurance different to public liability insurance?

Everyone is regulated under common law to not cause damage to anyone or their property or to cause them any financial loss. This liability is known as ones general duty of care and is separate to the professional liability that professionals have in the provision of their business to ensure that their client does not suffer any injury, damages to property or financial loss.

Professional Indemnity Public liability Insurance
  • Covers legal liability for claims arising from an act, error or omission of duty by the professional
  • Cover can include claims for personal injury, professional injury or financial loss
  • Provides cover for claims made for actual breaches of professional duty
  • Provides cover for legal liability due to personal injury or property damage caused by your business
  • Product liability is an extension of public liability providing cover for personal injury or damage caused by the use of your products
  • Cover may not always extend to claims for financial loss if there has been on injury or damage
  • Event giving rise to the claim will often have to occur within the period of insurance for cover to apply
  • The claimant must be able to establish that the cause of the loss has direct connection to the business.

 

Learn More

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Cyber Insurance, A Novel of 2017

 

View our Slideshare for more Documents and Slides

 

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Are Your Employees on Social Media?

 

Social media is big business these days.

Over half of Australia’s population is on Facebook, more than 4 million are on Tumblr, and Instagram boasts similarly large numbers. But besides LinkedIn, most social networks serve more purposes than just the professional realm.

This substantial growth of social media adoption brings with it unique risks to businesses that they once didn’t have to worry about. One of these chief risks is that an employee of your business can post questionable content to their social media accounts, which could, by extension, have a potential impact on your business’s image. Then there is also the risk of a disgruntled employee publicly stating their hatred for the company or even you.

This is thanks, in part, to the spontaneous nature of social media. Where someone can quickly share updates of a positive, negative or questionable nature dependent on their emotional state at the time. But as a business, do you have any right to ban employees from using social media or, at the very least, associating their personal accounts with your place of work?

 

To ban or not to ban

Truth is, banning your employees from social media may not go down that well. After all, it’s a valid argument for them to state that their personal lives and accounts are none of your business, and that’s because they aren’t. Choosing to dictate what an employee can or cannot do or post outside of work hours is a slippery slope, and the type of rule that can turn potential employees off from applying.

You may have some right to express concern if they have public social media profiles, which are commonly found with social networks such as Twitter and Instagram, but for those social networks where they may already employ stronger privacy settings (e.g. Facebook), trying to control their behaviour on those networks could be met with resistance.

You want to have happy employees who are proud to consider themselves a part of your team. Going the draconian route where you monitor and dictate their online behaviour tends to be frowned upon – especially in an age where people are more and more concerned about their privacy, autonomy, and rights to free expression.

So if banning them from social media worries you in terms of employee backlash, what other options are there?

 

A social media policy

One option is to create a social media policy. A policy such as this usually covers both how social media posts should be presented under your business accounts and how employees should conduct themselves on their own social media accounts. This can include rules such as ensuring they include a disclaimer that says: “My views do not reflect those of my employer”. Other rules could be that they’re not allowed to upload any photos of them in company attire unless explicitly permitted, that certain types of posts (e.g. photos of them intoxicated) cannot be uploaded, and so on.

Social media policies can work for some businesses and be relatively ineffective for others. You could trial some policy rules and see if employees are happy to adhere to them, or even set these rules only for their public social media accounts. Other rules can be refined, such as one that states they can upload candid photos of themselves in casual settings (i.e. having drinks), for example, provided those photos are set to “friends only” and that their profile and cover photo are of an acceptable nature.

 

Complete disassociation with your brand

Apple is one prime example of a company that places massive restrictions on what its employees are allowed to divulge about their jobs outside of work. These rules include that employees can’t wear Apple attire outside of the workplace, they’re not permitted to list the company they work for on social media profiles (LinkedIn is a single exception), and any talk of Apple cannot be done in a promotional/professional level. In other words, their position as an Apple employee remains at work and is almost entirely banned from being discussed on social media.

While this could come off as extreme, in many ways it’s a logical system. It essentially means your employees are allowed to be on social media and act however they want on it, and they can do so without presenting any real image risk for your company. You’d likely find that this approach will be considered more agreeable by your employees than outright banning them from social media.

You can find links to all of Statewide’s social media profiles in SOCIAL menu item

 

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The Basics of Small Business Insurance

Small Business Insurance for small, SME, medium, large business…whatever your business type, the common components of Small Business Insurance generally remain the same.

Lets run a quick guide on the basics of small business insurance.

 The Big 3

  1. Property Insurance
  2. Public Liability
  3. Workers Compensation

The Staples

  • Business Interruption
  • Burglary
  • Glass

The Extras

  • Money
  • Machinery
  • Electronic Equipment
  • General Property
  • Fidelity / Employee Fraud
  • Tax Audit

The Separate Policies

  • Professional Indemnity
  • Management Liability/Financial Lines
  • Motor Vehicles
  • Corporate Travel

The Big 3

Property Insurance

Any Insurance policy starts with the Property Section, sometimes referred to as the Fire Section.

This covers damage to Business Property at the Situation – caused by defined events – and provides a number of automatic additional benefits.

Covered Property includes:

  • Buildings
  • Contents
  • Stock
  • Plant & Machinery

Buildings means Buildings and structures at the premises.  If you are renting/leasing, it is most common that the building owner should cover the building.

Buildings includes:

  • verandahs, carports, car parks, sealed driveways and paths, shelters, awnings, gangways, staircases and all outbuildings
  • fixtures and fittings owned by the owner of the building
  • underground and above ground services including aprons, supply mains and meters
  • walls, gates, fences, flagpoles, floodlights and signs
  • permanently fixed water and fuel tanks.

Contents means all property at the Business Premises, belonging to You or for which You are responsible for.

It is generally reflected on our schedules to mean a combination of any of the below, and is less common to split each item, although this can be done if desired. Eg An amount for contents, an amount for stock etc.

Contents also includes:

  • paintings, works of art and curios
  • computer systems records, manuscripts, other documents, deeds, specifications, plans, drawings, designs, business books and other records of every description
  • documents of title and any other documents of historic value
  • plant permanently fixed to Your Buildings
  • machinery and/or equipment
  • fixtures, fittings and glass owned by Your landlord which You are legally responsible for and leasehold improvements
  • Stock
  • goods sold but not delivered and goods held by You on consignment or commission
  • property not owned by You but on Your Business Premises for service, repair, alteration or safe keeping
  • property of Your welfare, sports and social clubs.

Defined Events

The Fire or Property section is not just Fire, it includes many other ‘peril’s or events that give rise to damage.

  • Fire
  • Lightning, Thunderbolt
  • Storm, Wind, Rain, Hail
  • Explosion
  • Earthquake, Volcano, Tsunami
  • Riots, Commotions, Disturbances
  • Escape of Liquids
  • Impact
  • Vandalism
  • Malicious Damage
  • and can include Accidental Damage (to a set amount)

Underinsurance

This section is subject to underinsurance, meaning that any claim can be reduced by the amount it is under-insured.  In short, you must insure for full replacement value of building, contents, stock, plant and equipment and machinery.

With any wording, and particularly at Steadfast Broker wording, there are numerous automatic additions and extra covers available.

 

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Public Liability

“Named Insured” means:

(a) the person(s), corporations and/or other organisations specified in the Policy Schedule,

(b) all existing subsidiary and/or controlled corporations (including subsidiaries thereof) of the Named Insured incorporated in the Commonwealth

of Australia and/or any other organisations under the control of the Named Insured;

(c) all subsidiary and/or controlled corporations (including subsidiaries thereof) of the Named Insured and/or any other organisations under the

control of the Named Insured incorporated in the Commonwealth of Australia and which are constituted or acquired by the Insured after the commencement of the Period of Cover.

(d) every subsidiary and/or controlled corporation and/or other organisation of the Named Insured which is divested during the Period of Cover,

but only in respect of claims made against such divested subsidiary, related or controlled corporation or organisation caused by or arising out

of Occurrences insured against by this Policy, which occurred prior to the divestment.

“Personal Injury” means :

(a) bodily injury, death, sickness, disease, illness, disability, shock, fright, mental anguish and mentalinjury, including loss of consortium or services

resulting therefrom;

(b) false arrest, false imprisonment, wrongful detention, malicious prosecution or humiliation;

(c) wrongful entry or wrongful eviction or other invasion of privacy;

(d) libel, slander or defamation of character, unless arising out of Advertising Injury;

(e) assault and battery not committed by You or at Your direction, unless committed for the purpose of preventing or eliminating danger to persons or property.

“Property Damage” means:

(a) physical loss, destruction of or damage to tangible property, including the loss of use thereof at any time resulting therefrom; and/or

(b) loss of use of tangible property which has not been physically lost, destroyed or damaged; provided that such loss of use is caused by or arises out of an Occurrence.

What You are covered for

We agree (subject to the terms, Claims conditions, General Policy conditions, Exclusions, definitions and Limits of liability incorporated herein) to pay to You or on Your behalf all amounts which You shall become legally liable to pay as Compensation in respect of:

  1. Personal Injury, and/or
  2. Property Damage; and/or
  3. Advertising Injury;

happening during the Period of Cover – within the Geographical Limits – and caused by or arising out of an Occurrence in connection with Your Business or Products.

 “You, Your, Insured (where used in this section)” means the person(s), companies or firms named on the current Policy Schedule as the ‘Insured’. Each of the following is an Insured to the extent specified below:

(a) the Named Insured,

(b) every past, present or future director, stockholder or shareholder, partner, proprietor, officer, executive or Employee of the Named Insured (including the

spouse of any such person while accompanying such person on any commercial trip or function in connection with Your Business) or volunteers while

such persons are acting for or on behalf of the Named Insured and/or within the scope of their duties in such capacities.

(c) any Employee superannuation fund or pension scheme managed by or on behalf of the Named Insured, and the trustees and the directors of the trustee of any such Employee superannuation fund or pension scheme which is not administered by corporate fund managers.

(d) every principal in respect of the principal’s liability

 

 Workers Compensation

If during the Policy Period a Worker suffers an Injury in the Business and you are liable under the Act to make any payment in respect of the Injury, we will :

indemnify you against that payment and in addition, will pay all reasonable costs and expenses you incur with our written consent.

 “Worker” means:

(a) a person who is defi ned as a worker by the Act and who is employed or engaged by you;

(b) a person in respect of whom you are deemed to be an employer pursuant to Section 175 of the Act; and

(c) a person deemed to be your Worker pursuant to Section 175AA of the Act.

Policy Limit of the Common Law Insurance

We will not pay more than $50,000,000 for Common Law Liability and costs in respect of any one event, regardless of how many Employees are injured by that event.

Premium Calculation

The first premium and every renewal premium payable to us will be calculated on the amount of the Wages (as defined above) you estimate you will pay during the year following the inception or renewal of the Policy. Your estimate must include all amounts you estimate you will pay Contractors.

 You must provide to us within one month after the expiry of each year of the Policy Period, the correct amount of all Wages paid by you in that year, and when required, the number of Workers and Contractors you employed or engaged in that year. The Wages you declare must include all payments you made to Contractors.

 

Other Articles of Interest

 

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Restaurant Cover Restaurant Insurance

RestaurantCover.com.au is Australia’s first dedicated Restaurant and Cafe Insurance Provider. As Restaurant Insurance Specialists, we have developed Insurance Products to cater specifically to the Food and Hospitality Industry, ensuring Full Cover at Lowest Available Pricing.  Our Insurance Services are Australia Wide.

We provide Innovative Insurance Solutions for the Food Industry as a whole, and cover all Food Related Businesses.

  • Restaurants
  • Fast Food
  • Taverns
  • Cafés
  • Takeaway
  • Bars
  • Coffee Shops
  • Functions
  • Wineries
  • Fine Dining
  • Food Halls
  • And More

RestaurantCover.com.au was created to service the Insurance Needs of the Food and Hospitality Industry, as a specialist and dedicated Insurance Brokerage providing the absolute best in insurance solutions.

Unique and innovative, our Restaurant Insurance products are designed to meet the needs and demands of the Restaurant Industry, and each package has been tailored with the relevant occupation in mind, ensuring full cover at the lowest available pricing.

The Restaurant Cover mantra is simple:

To provide outstanding Insurance Broking services to the Restaurant & Food Industry.

Check us out today or contact your Statewide Account Executive for a competitive quotation.