Specialty Business Risks Insurance

Specialty business risks insurance is a type of insurance that is designed to protect businesses from unique and specific risks that are not covered by traditional insurance policies. These risks can include things like environmental hazards, cyber attacks, and other types of unexpected events that can have a major impact on a business.

One of the key benefits of specialty business risks insurance is that it can provide coverage for a wide range of different risks, from natural disasters and cyber attacks to product liability and professional liability. This can be particularly important for businesses that operate in industries that are particularly susceptible to certain types of risks, such as those that deal with hazardous materials or sensitive data.

Another benefit of specialty business risks insurance is that it can be tailored to the specific needs of a business. This means that businesses can choose the coverage that is most appropriate for their operations, rather than being forced to purchase a one-size-fits-all policy. This can help to ensure that businesses are fully protected against the risks they are most likely to face, while also keeping costs under control.

While specialty business risks insurance can be more expensive than traditional insurance policies, it can also be much more comprehensive. This means that businesses can be more confident that they are protected against a wide range of different risks, and that they will be able to recover quickly in the event of a loss. Additionally, having specialty business risks insurance can help businesses to mitigate the risk of a loss by providing them with the resources they need to reduce the likelihood of an incident occurring in the first place.

Overall, specialty business risks insurance is an essential tool for businesses looking to protect themselves from the unique and specific risks that they face. Whether you are dealing with environmental hazards, cyber attacks, or other types of unexpected events, specialty business risks insurance can help to ensure that your business is fully protected and that you are able to recover quickly in the event of a loss.

Actuaries were once associated with only insurance companies. They are now recognized as independent advisors whose expertise is used by many different businesses. Independent actuarial firms provide services such as outsourcing for insurance carriers that need temporary assistance on certain projects. They also offer advice to financial entities that attempt to determine the future value of potential takeover targets. Some perform analyses for insurance departments. The type(s) of actuarial service(s) the risk provides determines its underwriting acceptability and the premium to charge.

This insurance covers claims brought that allege libel, slander, defamation, infringement of copyright, title or slogan, piracy, unfair competition, or misappropriation of ideas, and invasion of the rights of privacy by an advertising agency. It also covers the cost of investigating such claims and defending against the legal actions.

United States workers on foreign assignments need property insurance coverage to protect their personal property from loss or damage. They also need liability insurance coverage to protect them against claims and/or suits due to allegations of injuries. This blanket coverage is available to corporations with multiple expatriate exposures. The master policy is issued to the corporation and certificates are provided to individual employees. The employer purchases a base layer of property and liability coverage for its expatriate employees. The employee can increase these base limits to fit his or her needs for an additional fee. Each plan covers personal liability and both scheduled and unscheduled personal property.

Answering and message centers serve businesses, professionals, contractors, and service companies that must have their calls answered and messages taken around the clock. They may also provide voice mail, fax messaging, printing, photocopying, and similar office services. This coverage insures businesses for injuries alleged to have occurred because of negligent acts, errors, or omissions in performing answering services for others.

This insurance covers nonprofit associations' professional liability exposures. The policy can include directors and officers liability that is designed specifically for nonprofit associations. The insuring agreement includes as named insureds all directors, officers, employees, committee chairpersons, and members, and any other association member while acting on the association's behalf.

This coverage protects business owners against certain types of unforeseen legal expenses. An important limitation is that it covers only legal expenses that qualify as a deductible expense on the insured's tax form. It is not intended to pick up legal expenses that the insured's general liability insurance covers. Examples include preparing and reviewing contracts, forms, and documents; litigating contract claims; responding to consumer legal actions; advising on labor problems; and even certain white-collar criminal charges. It reimburses legal expenses for defense costs, legal consultation, and plaintiff actions. Pricing is based on the types of expenses covered and the limits purchased.

This is travel protection insurance for business executives, and employees. Full- and part-time employees and volunteers who work for nonprofit groups can also be covered. All plans cover accidental death and dismemberment, emergency evacuation, and repatriation of remains. Most plans also include emergency medical assistance coverage. Coverage plans may be worldwide or limited to only specifically named countries.

Commercial credit insurance covers the insured's loss when a credit customer becomes insolvent or refuses to pay its account. Manufacturers, wholesalers, distributors, and certain service businesses are eligible. Retail operations are not eligible.

Commercial and personal lines carriers restrict coverage related to online activities. As a result, separate cyber liability coverage forms and endorsements are necessary to cover exposures such as libel, slander, infringement of copyright, and invasion of privacy. Coverage is also needed when hackers infiltrate a company's computer system and steal valuable third-party information, such as social security numbers, credit card numbers, and health information. Many companies offer cyber liability coverage but forms are not standardized. Some companies include first party coverage for damage to computer systems because of hacking and other types of viruses.

This coverage protects directors and officers of a corporation against claims that allege injury caused by their negligent acts, errors, or omissions while acting in their corporate capacities. It also indemnifies corporations for expenses they incur to defend such lawsuits. The market for this coverage is expanding and addresses all sizes of corporations. Some companies cover discrimination, wrongful termination, and sexual harassment.

This insurance covers the insured employer against claims made by its current or former employees due to damages caused by negligent acts, errors, or omissions in the employers administration of employee benefit programs. It covers claims resulting from the giving of incorrect advice concerning an employee's health care or pension plan or for failing to enroll employees under a benefit program. It usually excludes all fiduciary responsibility. It may be written on a separate policy or be endorsed to the employer's commercial general liability policy.

Staffing services furnish employees to businesses on a contract basis. They are responsible for the employees' payroll, employee benefits, workers compensation, and other human resource-related functions. Both general liability and professional liability are written in the same form. Third-party fidelity coverage, employment-related practices liability, and workers compensation coverage may also be provided.

Federal, state, and local regulations prohibit a number of employment-related practices. This insurance covers the insured if it or any of its employees are accused of any of the prohibited practices. The coverage provides a list of the federal regulations that can be cited in a claim such as age, race, gender, or disability discrimination. It also covers allegations of harassment and retaliation.

Accident/medical/sickness coverage for diplomats and world travelers can be purchased by foreign nationals visiting the U.S. and U.S. citizens who travel abroad. It is long-term coverage for individuals who do not have adequate coverage from an insurer in their home country. Several different accident and sickness plans are available. Each has its own deductible and coinsurance conditions. Each automatically includes provisions for emergency medical evacuation, return of bodies, emergency family reunions, and local ambulance expenses. AD&D benefits are also available, as are optional coverages for hazardous sports such as skiing, scuba and sky diving, motorcycle/motorbike racing, and bungee jumping.

Most homeowners coverage forms and policies include limited protection for certain in-home businesses. This coverage is often inadequate for many types of home-based businesses. This coverage insures home-based businesses that are beyond the scope of standard homeowners forms.

Identity theft liability is an evolving coverage. The most basic form covers liability imposed on a business because it failed to adequately protect certain vital information that its customers supplied. This information is such that its theft can allow the customers' identity to be stolen. Many carriers are expanding beyond this basic coverage to provide loss control assistance to prevent such losses and intense case management activities following a security breach in an attempt to lessen the impact of any loss.

Global account underwriting is tied to the growth in multinational corporations. Multinational businesses need a package of domestic and foreign insurance coverages combined under a single master program. A number of major U.S. insurers have large international networks of facilities that can provide insurance coverage in almost any country in the world for U.S. businesses that conduct operations overseas and/or export products overseas.

Internet liability is the most rapidly changing area of liability exposure today. The growth in the number of persons who use the Internet regularly has caused most businesses to promote and market their products and services online. These companies have home pages and many communicate with others via email, chat lines, blogs, social media, and more. Liability coverages and exclusions that apply to advertising injury, libel, slander, infringement of copyright, and trademark are being revised to reflect the changing conditions of online communication. A few insurers offer a package of coverages designed to protect businesses that provide online services to their customers and subscribers.

Kidnap, ransom, and extortion coverage has become more common as businesses expand their international outreach and send executives and key employees around the world. While ISO and SFAA have developed endorsements and coverage forms, restrictions and availability vary by company. One unusual aspect of this coverage is that the insured cannot acknowledge that they have the coverage because such acknowledgement could make them more of a target.

A limited partnership's general partners are the people and/or companies responsible for managing and running the partnership's operation. They can be sued for mismanagement, negligence, or waste of partnership assets. However, the greatest concern to general partners is probably the sizeable lawsuits brought against them by limited partners (investors) that allege violation of federal security statutes and "Blue Sky" laws. Limited partnership liability coverage insures general partners, both individual and company, the directors and officers of company general partners, and limited partners for alleged wrongful acts. It can be extended to include as insureds the affiliates of general partners and syndicators. The policy covers violations of federal security statutes and "Blue Sky" laws. Any form of new or existing private or public limited partnership is eligible for coverage.

A few markets write host liquor liability insurance to protect the possible exposure of individuals or business firms against liability for their use of liquor for business and non-business entertainment. Commercial general liability policies do not exclude coverage for claims that arise out of the use of liquor by firms that do not manufacture, sell, distribute, or serve alcoholic beverages. However, this coverage can be very useful when the named insured and the insurance company disagree about whether coverage applies at events when an accident that involves alcohol occurs.

The OCP policy provides liability coverage for a named insured who is sued for injuries related to the actions of a contractor working on his or her behalf. The contractor purchases the coverage but the owner/contractor for whom the contractor works is the named insured. Coverage is limited to bodily injury or property damage that results from operations of a contractor while working for the named insured. Coverage is limited to a specific project or contract and ends when the project is complete or the terms of the contract are fulfilled.

Political turmoil throughout the world makes United States investors and business firms aware of the threat that their assets in foreign nations where they do business may be expropriated. A firm may be exposed to loss from any of three broad categories of political risk: seizure of assets, currency inconvertibility, and interference with contractual performance. Confiscation, expropriation, nationalization, deprivation and, in some cases, terrorist and war risk coverages may be written under political risk insurance programs.

This coverage protects the insured when confidential information belonging to clients, employees or vendors is breached because of an alleged error on the insured's part. Coverage is provided for both defense and indemnification. Coverage also includes the cost to notify affected individuals.

Passage of the Employee Retirement Income Security Act of 1974 (ERISA) brought about one of the most significant changes in the insurance business. In addition to providing guidelines for the federal government to regulate private pension plans, it also greatly broadened the responsibilities of trustees and fiduciaries who directly or indirectly exercise control over pensions or employee benefits that fall under the act. Certain provisions of the act established new standards for prudent action by fiduciaries. The act permits purchasing insurance to protect the personal liability of trustees or fiduciaries for their negligent acts, errors, or omissions. This insurance may be purchased using assets of the plan or trust to protect the plan and its fiduciaries as long as the insurer has recourse against the individual trustee.

Following are some examples of Specialty Business Risks Insurance claims and the corresponding insurance coverages that can help pay for them:

1. Professional Liability: Suppose a consultancy firm is sued for providing erroneous advice that leads to significant financial losses for a client. The client files a lawsuit seeking compensation for these losses. Professional Liability insurance, a type of Specialty Business Risks insurance, can help pay for the legal defense costs, and if the firm is found liable, it can cover the monetary damages awarded to the client.

2. Directors and Officers (D&O) Liability: In an instance where the directors or officers of a corporation make decisions that result in financial harm to the company, shareholders might sue them for breaching their fiduciary duties. D&O Liability insurance can provide protection for these individuals, covering legal defense costs and any damages or settlements that might arise from such a lawsuit.

3. Cyber Liability: A software company suffers a significant data breach, resulting in the loss of sensitive customer information. Affected customers file a class-action lawsuit against the company for failing to adequately protect their data. Cyber Liability insurance can help cover the costs associated with this lawsuit, including legal fees, settlements, and any mandated notifications or credit monitoring services for the affected individuals.

4. Product Liability: A toy manufacturer is sued when a design flaw in one of their products results in injury to a child. The parents file a lawsuit seeking compensation for medical bills and emotional distress. Product Liability insurance can help pay for the company's legal defense and, if found liable, can cover the settlement or judgment costs, thus protecting the company's finances.

5. Environmental Liability: A manufacturing company accidentally spills hazardous waste into a local river, causing significant environmental damage. The local community sues the company for the cleanup costs and damages. Environmental Liability insurance can help the company cover the costs of the lawsuit and the necessary remediation to return the environment to its previous state.