Rethinking insurance in a world of hybrid work


With the shift to remote and hybrid work likely to become a permanent feature of the modern workplace, businesses should review their insurance cover to reflect some of the associated risks.

One of the lasting legacies of the pandemic will almost certainly be the rise of hybrid workplaces as employees engage in a blended model of remote and in-office work.

While this should bring productivity benefits, business leaders must be conscious of reviewing their insurance cover to take into account any changed working arrangements. For example, they need to mitigate risks in relation to any in-home accidents involving employees, or respond to cybersecurity threats in relatively unprotected home environments.

Being proactive on the insurance front can help ensure continuity of cover, and potentially result in lower premiums in some cases. Until recent years, most business insurance policies have been structured around the fact that employees typically worked in a company office. COVID-19 has altered that reality, and insurance policies need to change, too.

Here are some of the key issues to consider.

1. Cyber liabilities
This is perhaps the most obvious and worrying risk that has been heightened as a result of hybrid work. As remote staff use home wi-fi connections that are easier to attack than a corporate IT network, there are potentially serious implications for a business – and its clients – if there is a serious hack. These breaches could threaten intellectual property and data sets.

The flip side is that a business which takes steps to improve its cybersecurity – such as implementing a multi-factor authentication (MFA) login system – can safeguard its operations and potentially be favourably looked upon by insurers when determining policy premiums.

2. Property damage and theft
Continuously transporting laptops and other mobile devices to and from work comes with the increased risk of damage or theft. It is prudent to alert insurance providers or brokers if your business has moved from a predominantly office-desktop setup to one that relies on remote laptop use. This can have an impact on insurance valuations and premiums.

For instance, does your contents insurance cover company-owned equipment that is used in an employee’s home and which may be damaged or lost? With such cases in mind, your insurance policy may need to be changed from a fixed location option to an all-risk location option.

3. Employment law considerations
Although there are many potential advantages with remote and hybrid work, it does raise some grey areas in terms of employment law. As a consequence, management and HR should consider the need to tailor employment contract clauses to encompass home or hybrid work. This could include complying with the law on working hours, and ensuring that staff take adequate breaks and look after their mental health.

Staff who work remotely should also have access to the same opportunities as those who are physically in a workplace, and they may even be eligible to claim costs such as heating and electricity given that they are using such utilities in the course of their work. The bottom line is that the failure to address such issues could lead to legal claims against a business – and any insurance cover needs to reflect such threats.

4. Employee health and wellbeing
COVID-19 has shown that flexible work practices can cause additional stress and a feeling of isolation for some staff. Among the findings from the 2021 Allianz report, titled Finding Balance in the Modern Workplace, is that two in five employees admit they do not have a transitional space between work and home, both mentally and physically, while 40% believe there is an expectation to work longer hours because of the pandemic. In addition, bosses need to be aware of possible health and safety legislation in relation to remote working practices.

Given rising concerns around employee welfare, insurers will likely want to know how a business is responding to such issues, including guidelines around working overtime outside the main office, compliance with management practices, and any safety concerns around designated work areas in the home.

This all means that employers can now find themselves under extra pressure to look after the welfare of their people in a blended work environment. So, it is vital to have adequate cover in place to protect against potential claims from employees.

Time for an insurance review
As workplace fallout from the pandemic continues, it makes sense for businesses to review their current insurance cover and possible future needs. This could involve changing the terms of their coverage, or simply adding new lines of coverage to meet new risks.

Devising effective insurance solutions can be difficult, of course, but seeking the support of specialist expertise whereby you get impartial and unbiased insurance advice can make a real difference. Such a process can ensure that business leaders look at their insurance policies through a remote and hybrid workplace lens.

Doing so is a smart move for businesses, their employees and their clients.

For more advice on how to navigate through hybrid workplace risks, speak to one of our experienced insurance experts.

Also read - Climate change – what it means for your insurance premiums.



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