Insights

Wording of Some Insurance Policies May Allow Claims on Coronavirus Closures
Wording of Some Insurance Policies May Allow Claims on Coronavirus Closures 1920 1280 James Hallam

Businesses have been advised to seek advice if they think their insurance policy could cover the enforced closure caused by the coronavirus outbreak.

David Noble, director of hospitality and leisure, explained that insurers will not have intended to cover the current situation, but that the writing of some policies may produce circumstances where a claim can be pursued.

He explained: “It was not the intention of the insurance industry to cover the Covid-19 pandemic that resulted in the closure of the UK hospitality industry. Insurance companies had suffered large losses during the Sars outbreak, so policy wordings were written to try and limit insurers’ exposure to global pandemics. If they had priced for such an event, insurance premiums would not have been affordable.

“It was, though, insurers’ intention to cover, where purchased, business interruption losses for outbreaks of infectious diseases on the premises or in close proximity to the premises. The government making Covid-19 a notifiable infectious disease triggered this cover in some policies. However, there were very few reported losses of this nature because shortly after the government closed hotels, restaurants, bars and pubs.

“While this triggered possible claims in some policies that extend to cover ‘non-damage denial of access’ to premises following the ‘closure by a public authority’, most policies contain a version of a pandemic exclusion. The words differ from one insurer to another and, in some cases, from one wording to another with the same insurer. For example, an insurer might have a specialist scheme arrangement for a particular class of business.

“Some wordings suffer from poor draughtsmanship, so it can be argued that the [pandemic] exclusion is not obvious, and in some cases it has been missed out completely. In these circumstances, it will be difficult for insurers to repudiate claims, despite what some have been saying in the press.

“My advice is, in the first instance, speak to your insurance broker. They can advise you on what cover you have. If you are not satisfied, seek a legal opinion, but if that is not a viable financial option at the moment, speak to a loss assessor. The good ones will give you an honest opinion on your cover and only charge on success.”

Read the full article by Emma Lake in The Caterer here.

Be Aware – 18th Edition IET Wiring Regulations Launched
Be Aware – 18th Edition IET Wiring Regulations Launched 1920 1280 James Hallam

Last year saw the publication of the 18th Edition IET Wiring Regulations. The regulations apply to the design, erection and verification of electrical installations; and additions and alterations to existing installations.

Also known as BS 7671:2018 Requirements for Electrical Installations, these changes were issued on 2nd July 2018 and came into effect on 1st January 2019. The period between publication and application gave a 6-month window for electrical contractors and others responsible for installing and maintaining electrical installations to become familiar with the new regulations.

Whilst there are many small changes from the previous 17th Edition, some of the significant updates in the new 18th Edition cover include:

  • Protection Against Electric Shock – changes to regulations relating to protective equipotential bonding and those relating to disconnection times.
  • Protection Against Thermal Effects – of particular relevance to fire, a new regulation has been introduced recommending the installation of arc fault detection devices (AFDDs) to mitigate the risk of fire in final circuits of a fixed installation due to the effects of arc fault currents.
  • Protection Against Voltage Disturbances – stipulating that transient over-voltage protection has to be installed when (amongst others) the consequences caused by over-voltage results in interruption of commercial or industrial activity.
  • Inspection and Testing – this has been revised to align Inspection and Testing requirements to other revisions within the 18th Edition.
  • Energy Efficiency – recommendations for the design and erection of electrical installations with local production and storage of energy to optimise the use of electricity. These are listed in a new appendix.

This doesn’t mean that existing electrical installations installed in accordance with earlier editions of the wiring regulations are now unsafe or require upgrading, but any new installations, alteration or additions made from 1st January 2019 onwards will need to comply with the new regulations.

It is always recommended to hire contractors who are members of a trade body such as NICEIC when choosing an electrical contractor to inspect and test electrical installations within your premises. Many commercial insurance contracts contain a fixed wiring electrical inspection condition and generally stipulate use of an NICIEC contractor.

For more information, please contact us on 01923 298435.

Cyber & Data Risks Insurance
Cyber & Data Risks Insurance 1920 1280 James Hallam

Each year when completing a review of their insurances, most businesses will look at uninsured exposures with their insurance broker. Most of these can be reasonably ignored following simple cost-benefit analysis, but cyber is more difficult in that the associated risks and their potential cost to a business are still developing. It is anticipated though that the frequency and severity of such incidents will continue to rise, mirroring the experience of North America where cyber risks are given a higher regulatory and boardroom prominence. In the US it is now estimated that over 75% of corporate businesses purchase cyber insurance.

  • Different businesses will be exposed to cyber risk in different ways; some are reliant on their website to drive turnover, some rely on a hosted accounting or billing system to operate whilst others hold sensitive client data or intellectually valuable data on their systems. There are a multitude of scenarios that leave a business exposed to internal and external electronic threat. The failure of an IT network could be debilitating and a good first step is to identify and take steps to mitigate external and internal IT risks. These include:
    data theft or data loss
  • hijacks where hackers gain control of a system and demand a ransom to restore service
  • bot scams where viruses are used to take over large numbers of computers
  • basic human error (internally generated risks should not be overlooked and continue to be the most common proximate cause to a cyber loss)

Notification costs following the loss of third party data is now a major concern for EU business following GDPR. Safekeeping of data is the responsibility of the customer facing entity, notwithstanding that a third party processing company may have been the party that lost the data and/or contractual terms making a third party responsible for notification. This means if you are hacked and lose your customer data (names, addresses, credit card numbers etc.) you will need to report the loss to the data commissioner, possibly pay PCI fines, pay the cost of notifying your customers that they are at risk, pay for advice to manage their risks and pay PR costs to manage the potential damage to your brand and reputation. All of these risks can be insured and cyber insurance will additionally cover fines and penalties associated with regulatory investigations due to a privacy event.
The other major threat to a business may be the loss of a website and a resultant loss of revenue. Again, this can be insured.

  • The cyber insurance market has been developing at a rapid pace over the past five years as experience has been gained by insurers. Areas of cyber-risk that can now be insured include:
    replacing, restoring or recreating data that has been corrupted or destroyed by network failure or first/third party intervention
  • loss of data and notification management costs
  • criminal threat or extortion to release sensitive information or bring down a network unless demands are met
  • loss of income and extra expenses resulting from when a network is interrupted by attack. Covers criminal hackers, malicious insiders and denial of service (DOS) attacks, (including extortion monies)
  • payment fraud (deception of the insured’s customers into transferring over funds)
  • public relations expenses and crisis management
  • disaster recovery activation costs
  • fines and penalties where insurable by law
  • use of leased / rented external equipment
  • use of third party services
  • additional staff expenditure and overtime payments
  • terrorism risk, including ideological risk (LulzSec, Anonymous etc)

James Hallam Insurance Brokers have been placing cyber risk in the London market for over fifteen years. We source cover to insure against all of the above threats and, in addition, we can protect against risks that the majority of cyber insurers omit. For example, our favoured market will also provide:

  • the provision of first party cover on an “each and every claim” basis, ensuring that policyholders aren’t restricted by a policy aggregate and that the full benefits of cover are available each time a crisis strikes, even if they experience multiple cyber incidents in the same policy period
  • full retroactive cover as standard, meaning that policyholders are covered for breaches they discover during the policy period, even if it first occurred long before. Symantec has reported that the average time to discover a breach is 205 days, making this a particularly important feature
  • an extensive in-house incident response capability to ensure that cyber incidents are dealt with quickly and efficiently in real time. Initial response services are offered with no deductible payable by the insured
  • broader cover for senior executive officers who are regularly targeted in cyber attacks, covering theft of personal funds of individuals as well as those of the company
  • if a suit is brought against directors and officers following a cyber attack, the policy provides affirmative cover in the event that their management liability policy doesn’t respond
  • incident response costs are provided in addition to the policy limit
  • no excess is applied to the initial reporting and investigation costs
  • full systems failure is covered, including resultant business interruption
  • full Supply Chain is covered, including Technology suppliers (and non-Technology suppliers if named)
  • Cryptojacking and Botnetting are included under the definition of Cyber Crime
  • Additional Extra Expense coverage is included for costs above the normal operating expenses of a business
  • Hardware Replacement coverage is included for computer hardware or tangible equipment damaged as a result of a cyber event

Some points to consider when discussing Cyber Risk with your clients

Dealing with a ransomware incident is rarely a simple matter of the ransom payment being made and the business in question automatically regaining access to their systems and data. Even after a ransom payment has been made, and assuming the system can be successfully decrypted, the ransomware can have the unintended side effect of severely impairing the functionality of one or more of a business’s vital systems.

The use of legacy systems can significantly increase the risk of a cyber loss. Generally speaking, legacy systems are not only far more vulnerable to attack, they are also much more susceptible to dysfunction following a cyber attack.

The importance of having data re-creation cover is becoming increasingly apparent. Many cyber policies only provide cover for the cost to recover or restore data from back-ups, but not the costs to re-create or re-enter lost data from scratch. The bulk of the costs to a claim can come from the labour costs associated with manually re-entering data, and brokers should be sure to check that their clients have this important cover in place.

Almost all modern businesses have some form of cyber exposure. Even if a policyholder does not solely rely on their computer systems to carry out work, they will still have an office function that playing a key role in the running of the business. When the computer systems in an office are affected by a cyber event it will almost certainly have a negative impact on the overall business operation and having a cyber insurance policy in place will provide a valuable safety net for the company.

James Hallam can place cyber insurance in the London Market for business domiciled almost anywhere worldwide so please feel free to get in touch if you would like us to assist you and your clients.

Credit Insurance Can Be Essential To Your Business
Credit Insurance Can Be Essential To Your Business 1920 1280 James Hallam

2019 is set for a significant increase in business failures since those following the Global Financial Crisis of 2008.

Insolvencies will occur for reasons not seen before such as stress on cash flow due to stockpiling, delivery delay and failure to recognise the effect of tariff and regulatory changes.

  • All business sectors are likely to see margins and their ability to pay promptly squeezed
  • Several high profile insolvencies have occurred in 2018 and companies in many sectors are issuing profit warnings – even the on line retailer ASOS
  • The Office for National Statistics quarterly release shows insolvency  increases in Q3 2018 of +8.9% sequentially on Q2 and +19.3% on Q3 2017
  • This demonstrates a fragile economy with definite potential for more business failures in 2019

Suppliers of goods and services need up to date financial information to ensure customers are able to pay their invoices and the security of knowing unpaid debt is covered by insurance. Not only does a credit insurance policy provide debt collection and indemnity for non-payment following insolvency or protracted default but also REAL TIME FINANCIAL INTELLIGENCE

A ‘buyer’ of goods and services failing to meet debt obligations or with a weakening financial position will be alerted to credit insurers in advance of information becoming public. This critical data enables a credit insured company to review their exposure with vulnerable customers and minimise potential for bad debt

Credit Insurance offers a solution – let our experts speak to you about the benefits this can bring to your business

Be Aware- Selection and Control of Contractors
Be Aware- Selection and Control of Contractors 1920 1280 James Hallam

There are many examples where failure of the client-contractor relationship has caused fire or other damage to property, or a significant accident resulting in injury to others. The impact of such an incident on a business can be significant, resulting in loss of revenue, damage to reputation, uninsurable fines and in the worst cases the prosecution of both parties and/or imprisonment where severe injuries or fatalities have occurred.

Even if contractors visit you regularly, a high turnover of staff may mean that some of their workers are visiting you for the first time and therefore unfamiliar with the premises, unprepared for the hazards, or unaware of any safety measures they should take. They may have had no health and safety training at all.

What Do I need To Consider?
A policy for the selection and control of contractors;
Approved contractor status for those in regular use;
Obtain confirmation in advance of the work that the contractor holds adequate public liability insurance. The policy must cover the activities undertaken on your behalf i.e. hot work, or working at height etc.
Ensure a risk assessment is completed for each job and the contractor is involved
Put clear risk control measures in place and ensure supervision of contractors is effective.

What Key Actions Do I need To Take?
Introduce a Control of Contractor Policy and a Permit to Work system, authorise contractors using a questionnaire as part of a formal selection process, agree a formal risk control procedure including method statements where appropriate.
Ensure your managers and staff understand your control of contractors policy and their specific and general health and safety responsibilities when contractors are on site.

Where Can I Get Further Information?
The HSE provide information on a wide range of topics via the HSE Books website. For example:
‘Essentials of health and safety at work’
INDG417 Leading health and safety
HSG159 Managing contractors
INDG368 (Rev 1) Use of contractors: a joint responsibility
HSG250 Guidance on permit-to-work systems
Health and safety passport schemes

Advice and Support?
Please contact Marc Brennan if further guidance or advice is needed

Tel 07879 49356

Government Signals Intention to Secure Tourism Sector Deal
Government Signals Intention to Secure Tourism Sector Deal 1920 1280 James Hallam

The Government has signalled its intention to deliver a landmark sector deal for the UK tourism industry to attract more domestic and overseas visitors and help drive major economic growth.

Speaking to the Tourism Industry Council, made up of leading members of the tourism industry and government, the Secretary of State for Digital, Culture, Media and Sport Jeremy Wright confirmed the Government will begin negotiations with the sector on an ambitious Industrial Strategy sector deal that will benefit the whole country.

As part of this process, he has called upon the industry to respond with a renewed commitment to promote its offer throughout the year, not just in the peak summer months, and increase high-quality, well-paid jobs.
The sector has been asked to look at the key themes of:
• Making tourism and hospitality a career for life
• Making the UK the most accessible tourism industry in the world
• Sharing industry data to identify growth opportunities in new and emerging markets
• Increasing accommodation capacity

The announcement follows an initial proposal submitted by tourism industry leaders, led by Steve Ridgway, Chair of the British Tourist Authority. It also comes as the Government marks one year since the launch of its modern Industrial Strategy, which aims to boost productivity by backing businesses to create good jobs and increase the earning power of people throughout the UK with investment in skills, industries and infrastructure.
Jeremy Wright, Secretary of State for Digital, Culture, Media and Sport, said:

The tourism industry is one of the UK’s most successful exports. Every time a leisure or business traveller chooses to visit, it brings investment in our economy and supports jobs across the country. But we are in a competitive global market and we need to be ambitious to maintain the fantastic growth we have seen in recent years.

I want to make sure that we continue to attract visitors to all parts of the UK throughout the year, who are welcomed by a highly-trained and highly-motivated workforce.

A Sector Deal is a way to deliver this, and the industry have put forward some strong ideas to Government. We are ready to formally negotiate on a deal which can boost productivity in this crucial sector.

I want to achieve the best deal possible for tourism and know that the industry will respond with renewed energy to achieve this.
UK tourism is now worth over £66 billion a year to the economy. The sector employs 1.6 million people, covering beaches and activity parks, to hundreds of thousands of heritage sites.

Annual statistics released in July revealed that a record-breaking 39.2 million visits were made by overseas tourists to the UK in 2017, with the latest domestic tourism figures showing that residents across Great Britain took a total of 120.7 million overnight visits to destinations in England, Scotland and Wales in 2017.

There are more than 11 million disabled people in the UK with a combined spending power of their households, ‘the purple pound’, standing at around £250 billion. There are a number of business benefits for ensuring that disabled people’s needs are catered for – from improved training on disability awareness for staff to adaptations to ensure facilities are accessible.

A potential tourism sector deal is an opportunity for driving change, through workforce development and consequent productivity gains, resulting in perception changes of hospitality and tourism as a career for life.

British Tourist Authority Chair Steve Ridgway CBE, former Chief Executive of Virgin Atlantic Airways, who is leading the UK tourism industry’s bid for a sector deal under the UK Government’s Industrial Strategy said:
Tourism is an economic powerhouse, a growing industry with huge potential to scale-up productivity, so it is very welcome news that an official negotiation for a sector deal has today been confirmed by the UK Government.

Securing this deal will be a game-changer for the industry, spelling a step-change in how we underpin the success of tourism for a generation, fixing issues from skills and productivity to extending the season year-round and building stronger tourism destinations up and down the country. And it will be a game-changer for the economy with a sector deal growing the value of the industry and increasing employment in tourism.
One of the UK’s most valuable export industries, tourism needs no trade deals to attract overseas investment. It is also a fiercely competitive global industry and a sector deal moves tourism right up the UK Government’s agenda as a priority for future economic planning, ensuring we continue to compete as a world-class destination for all visitors.

The Secretary of State also challenged the tourism industry to use the sector deal negotiations as an opportunity to deliver more collaborative data sharing with VisitBritain, around visitor figures, behaviours and audience analysis. This is to help take a more strategic approach to promotional activity and a more united approach to environmental protection

From: Department for Digital, Culture, Media & Sport and The Rt Hon Jeremy Wright MP

Welcome to the World of Dress 2 Kill
Welcome to the World of Dress 2 Kill 800 350 James Hallam

James Hallam have sponsored 3 ‘Tailor TV’ events over the last 6 months, which are run by a London tailor called Dress 2 Kill. They are an evening of drinks and a Q&A with notable guests, which is governed by Alex Payne, from Sky Sports and the Influence Room. The guests we have had so far are; Jonny Bairstow (England Cricketer), Eddie Jones (England Rugby Head Coach), Kyle Sinckler (England & British and Irish Lions Rugby Player), Jack Clifford (England & Harlequins Rugby Player) and Charlie Brake and Dr Alex from Love Island.

TailorTV is the official media channel of the exclusive event, providing behind the scenes access to leading International sports stars and celebrities. Unscripted, uncut and unrehearsed, TailorTV events take place throughout the year in front of a private audience in Central London.

Make sure you subscribe to TailorTV to keep up to date with all the great content from the events. Click here to view their YouTube channel

James Hallam Need Your Vote to Support Local Watford Charity
James Hallam Need Your Vote to Support Local Watford Charity 1920 1280 James Hallam

Tucked away behind Furniture Village on the Century Retail Park is the Watford Workshop – one of the town’s most fascinating charities.

Established for over 50 years, the charity provides work experience, skills training, and employment for disabled and disadvantaged people. Making a huge difference to the lives of some of the most vulnerable and too often forgotten and neglected members of our community.

Click here to read the full story by ‘Mustr Watford’

The Aviva Community Fund- Vote For Us!
The Aviva Community Fund- Vote For Us! 800 700 James Hallam

James Hallam are supporting Watford workshop, in a bid to win a grant that could have a profound positive impact on the local community.

About the competition:
The Aviva Community Fund offers us the chance to get funding for causes important to our community. The competition will finance over 500 projects across four different fund levels and three categories, giving money to communities across the UK. The aim for us is to get enough votes from friends, family and supporters in the community and our project could make it to the Finals, where a judging panel will award the funds.

Watford Workshop plays a vital part in an individual’s transition into unsupported employment within a mainstream workplace. They are making a big difference to the lives of some of our most vulnerable and too often forgotten and neglected members of our community. So, our application to the Aviva Community Fund is for help with the funding of a mezzanine floor area in the Workshop, as well as the equipment necessary to make this accessible to all service users. The workshop building is modern and lofty and WSW have been granted a lifetime lease from Watford Borough Council. As such, any investment in the building facilities would most definitely be a long-term one and make a direct and immediate difference to the Workshop capacity and ultimately the number of people it can accommodate and help through both the Workshop and Training activities. Initial quotes suggest the cost of a suitable and accessible mezzanine area would be in the region of £25,000, plus around £10,000 for an appropriate lift, to ensure that all service users are able to access all areas.

Please click on the link below and VOTE FOR US, plus find out more about Watford Workshop and how this money could make a difference. Voting takes 20 seconds and will make an enormous difference, every vote will count- you get 10 votes and can allocate them all to just the one cause.

https://www.avivacommunityfund.co.uk/voting/project/view/4-1590

The Biggest Competitor You Didn’t Know You Had
The Biggest Competitor You Didn’t Know You Had 1920 1280 James Hallam

PwC’s 2018 Global Economic Fraud Survey reveals that 49% of organisations admit to having been targeted or hit by fraud. What they don’t say is that some of the remaining 51% might also have fallen victim to fraud but just don’t realise it.

Corporate fraud is a growing problem in the UK, but for small and medium-sized businesses preventing fraud is proving increasingly challenging. All too often, SMEs simply don’t have the necessary resources to carry out internal checks and balances for their accounting systems. And, despite the clear advantages of fostering a culture of trust within a business, evidence shows that you’re just as likely to fall victim to internal fraud perpetrated by a long-term employee as you are by a recent recruit or contract worker.

So what can you do?

  • External fraud: Review your business processes to ensure they’re safe from potential hijack. For example, when you’re transferring a large sum of money to a supplier, ensure the process is secure by verifying the account details from at least two separate known sources.
  • Payroll fraud: One of the most common types of payroll fraud is where a so-called ‘ghost’ employee is created by someone with access to payroll with the intention of diverting funds either to themselves or a third party. This ‘ghost’ employee may be entirely fictitious or a past employee who was never properly removed from the payroll system. You should also watch out for employees altering their timesheets to increase the hours they’ve worked. An employee may also ask for an advance on their salary but fail to pay it back.
  • Accounting fraud: An employee might tamper with the company’s accounts to cover up theft or use the company’s accounts to commit theft. You should also look out for employees falsifying their expenses. This can include using forged receipts or double claiming for expenses. Run spot-checks on your accounts, including accounts that have been written off by the business.
  • Supplier fraud: A supplier may commit fraud on their own or in collusion with someone inside your business. This might involve an employee taking a payment from a supplier in return for preferential treatment. Another example is where a supplier inflates invoices to charge the company for more goods that it provides or charges a higher price than was agreed.
  • Low-level theft: No theft is too small when it comes to your bottom line and low-level theft, if allowed to continue unchecked, eventually mounts up. This could include anything from theft of petty cash to misuse of company services or resources. Also, look out for employees who are unwilling to take annual leave or are unwilling to let others get involved in their work, as this may be a sign that they fear being found out. You should consider implementing compulsory annual leave in high-risk areas of your business.

Make certain that you are adequately insured

If you discover you’ve become a victim of fraud, a comprehensive crime policy can provide essential balance sheet protection for your business. Moreover, fraud now comes in so many forms – internal, external and online – that it’s essential you get professional advice to make sure you’re doing all you can to protect your business.

For more information please contact
David Noble:
david.noble@jameshallam.co.uk
02079777856

Or Marc Brennan:
marc.brennan@jameshallam.co.uk
02079777862

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