When it comes to insurance, things get bad fast when one claim leads to another

Insurance exists to mitigate risks and make it less costly when an issue arises. Policyholders accept the likelihood of claims happening over time. However, not everyone is prepared for several risks in rapid succession, which can easily happen. Not being prepared could become a costly mistake.

Accumulating risk can affect people both personally and professionally. A homeowner may see one claim event quickly lead to others, while business owners could lose their whole operation. Let’s look at a few of the most common accumulated risk scenarios and what policyholders can do to stay safer. Accumulating risk from the professional perspective

The usual business premise consists of property, equipment, staff, the product/service, and often customers. Now picture this: a worker makes a mistake, and either hurts themself or harms the property or a customer. Or maybe a fire or flood decimates the premises, equipment, and products all at once.

In short, businesses are a combination of things that are all at risk and all in the same place. Protecting one relies on the others being adequately protected. There are several policies which can protect a business against these accumulated risks in their different forms:


  • Kismayo General liability: protects in the event of bodily injury, property damage, personal injury
  • Professional liability: protects in the event of loss arising from claims of alleged negligent acts, omissions or errors in the performance of professional services
  • Commercial property/business equipment: covers physical damage and loss of business assets
  • Workers’ comp: provides a portion of lost wages and covers medical expenses to employees injured on the job
  • Employment practices liability insurance: protection employers against worker claims of discrimination, wrongful termination, and other employment-related issues
  • Loss of income: can reimburse a business for lost net profits and necessary extra expense following an insurable event


Combining these policies will protect people and replace or repair property and equipment that is damaged or lost. What these policies won’t cover is one area of accumulated risk businesses often don’t think about: the loss of critical data.

Covering your cyber bases

Today’s digital society is a significant risk factor. Customer data storage and being online is now part of everyday practice. However, these practices bring daily dangers like data loss, violation of privacy, reputational damage, and more. One successful breach of your customer or company data and the knock-on effect could be financially and professionally devastating.

Adding internet liability insurance as additional coverage can comprehensively protect your business interests.

Cyber liability is similar yet separate insurance. It covers businesses in the event of breach-related downtime, third-party financial loss, loss of revenue and more.

Electronic data processing coverage goes even further in specifically protecting vital digital information.

These may seem like unnecessary protections in the age of antivirus programs, firewalls, and multi-factor authentication. However, insurance does something these others don’t: it’s effective at all times.

Even the best online protection can’t stop every risk. New threats are evolving every day, and it only takes one cyber incident to start a chain reaction of damage.

Accumulating risk from the personal perspective

Individuals and families can consider accumulated risk in much the same way as businesses do. Whether renting or owning your home, it’s a place you want to protect, and that applies to its contents and inhabitants (be they people or pets). Home and rental insurance policies generally combine coverage across five risks categories:


  • Liability: protection for financial loss if found liable for someone’s injury or property damage
  • Loss of use: additional living expenses if you have to move out during home repairs caused by a covered peril
  • Dwelling: covers damage to your home and its surrounding elements such as fences and sheds
  • Medical: pays for anyone hurt while in your home or if your pet bites someone
  • Personal property: covers destruction, damage, or theft of your home’s contents


This is basic coverage that can be expanded with various add-ons, such as flood insurance (which is also a great risk shield for businesses), animal liability, or umbrella insurance to better cover accumulated risks.

Umbrella insurance can be a great help if one risk spirals into other policy areas, as it can pay excessively expensive claims that your primary coverage can’t handle.

How much personal insurance you need depends on the nature of your home, your lifestyle, and personal possessions. Single people will likely need less coverage than a family due to fewer possessions. At the same time, the age of a property, its location, and how many upgrades it has also play a part.

In short, the more a property consists of inside and out, the greater the accumulated risk. Speak to the Avante team to discover your own accumulated risk profile, and the suite of insurance products that will protect you.

Avante Insurance is a South Florida family owned and operated agency serving an array of commercial and personal insurance services to meet our customers’ individual needs. For more information, feel free to call at 305-648-7070 or complete our contact form.

*This blog and website are made available by the publisher for educational and informational purposes only. It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state.