Talk to an agent to make sure your commercial insurance policies cover the risks of having remote workers
- A large number of employers have at least some remote workers
- The remote work ecosystem brings new risks to businesses
- While you may think you’re covered, it’s important to re-examine your policies
- Even workers’ comp is affected, as well as cyber insurance and other policies
While remote work is not new, it has increased dramatically during the pandemic and looks like it’s here to stay. A survey of business leaders discovered that 80% will allow employees to continue working remotely after the pandemic at least some of the time, and 47% will allow full-time remote work. The conclusion is that most companies will continue to allow remote work in some capacity.
While this shift in the work environment has a lot of perks for businesses in terms of productivity, employee satisfaction, and decreased expense for office space, it also means a shift in risk and potential liabilities when it comes to business insurance.
Until recently, commercial policies were written with the assumption that employees work in company offices. This makes it critical to examine and update your business insurance to accommodate the new remote work ecosystem. Let’s go over what you need to consider when updating your insurance policies.
The new risks that come with a remote workforce
Remote working is a new environment that brings new risks. These are some things you should think about when updating your business policies.
Workers’ comp and remote employees
Employers are required to have workers’ compensation insurance in Florida to cover employees who become ill or are injured doing their job. In the case of remote workers, workers’ comp takes on an iffier aspect. Since they are not working on your premises, they must prove the incident occurred during business hours while they were performing work.
Taking this into consideration, your workers’ comp policy may need a language update. Keep in mind that 1099 contractors and freelancers are not covered under standard workers’ comp policies.
Remote workers and cyberattacks
Having remote workers means they have remote access through a number of devices – phones, tablets, desktops, and laptops – which means new security risks. We’ll discuss insurance updates in a bit, but first, here are some things you or your IT department should put into place to protect your business:
- If possible, implement an encrypted Virtual Private Network (VPN) for staff to access applications and resources. VPNs can decrease speed and block certain online services, so do some research before deciding if this is right for your business.
- Make sure employees have updated antivirus software and a firewall on their devices.
- Assign strong passwords and change them regularly.
- Train employees to spot phishing and other scams.
Also, consider a company-wide implementation of single sign-on software that reduces your vulnerabilities by authenticating users. While these are two areas of concern with a remote workforce, there are others, which make having the right insurance coverage vital.
The commercial insurance coverage you need with a remote workforce
The change to long-term remote work affects business risk exposure in several areas and in ways that can affect your company’s insurance policies. It’s important to review your policies carefully with your insurance agent to ensure there are no coverage gaps or issues, and to make recommended changes that will protect your business.
Check that your policy provides the following coverage:
Purchase dedicated cyber insurance. This is essential for any company that employs remote workers because this creates vulnerabilities for hacks, social engineering tactics, and data loss and privacy issues. If you already have a dedicated cyber policy, it should be reviewed to these if its terms match the increased risks caused by remote operations.
A typical cyber insurance policy protects your company against losses and third-party liability that result from a network security breach or failure. This includes attacks such as malware, ransomware, distributed denial-of-service attacks, or any other methods used to compromise your network and sensitive data.
If your remote workers are using their devices to access company networks, you must make sure that your cyber policy includes these devices in the scope of covered computer systems for cyberattacks. Also, when deciding policy limits, estimate the expected cost of repairing or restoring your network after a cyberattack, including at remote work locations.
Covered losses usually include:
- Liability from the unauthorized use, access, disclosure, or destruction of protected information.
- The costs incurred if you have a breach, including compliance with a breach notice law.
- The costs to assess the disclosure of protected data through the hiring of a computer forensics consultant.
- The costs of minimizing reputational harm to your company, including setting up call centers as well as providing credit monitoring services to those affected by a breach.
- Money paid in response to a ransomware demand.
- Liability that comes from a failure or breach of network security.
- Business interruption if your network is shut down or made unusable due to a cyberattack.
Commercial property insurance usually covers locations that your company rents or owns and the contents of the property. Take a close look at your current policy because it may exclude or severely limit coverage for property located outside specified locations.
Check that your policy terms cover the company-owned equipment of remote workers as well as any data that it contains.
General liability protects your business against financial losses that result from bodily injury, advertising injury, and property damage caused by your business or your employees.
If you have remote employees who meet clients at their homes, your commercial general liability policy will cover any injury, rather than the employee’s homeowner’s insurance. Talk to your agent about additional coverages to protect you and your workers from all of the risks that may not be covered by your commercial general liability policy.
Remote work arrangements can have many benefits for both businesses and employees but it’s important to manage the very real and very new risks to your business.
Protect your business and your remote workers with Avante
Remote work is a whole new world of challenges and opportunities. Make sure you’re prepared for both the rewards and risks a remote workforce brings.
At Avante, we’ll work with you to build the complete coverage you need with a deductible that works for you. Reach out today because you never know what tomorrow will bring.
This blog and website are made available by the publisher for educational and informational purposes only. It is not to be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state.