Lessons Learned in an Insurance Context:
Action Items Related To COVID-19 By Russ Davies and Scott Loy
Virtually every business across the United States and globally has now had “the
What can you do about it now?
Cyber Policy – Cyber liability insurance might
Turn In the Claim – While not creating false
be the most important piece of insurance
to submit the claim to your insurance carrier
designed to protect you from cyberattacks like
insurance coverage addresses the situation.
Market data shows that a cyberattack is much
insurance is for?” “Isn’t insurance supposed
a synopsis of financial information both pre-
attacks do not discriminate when it comes to
situation that could happen to MY BUSINESS?”
situation impacted your business.
small to medium companies could be more
conversation” with their risk manager/insurance
hope, the recommended action right now is
any business owner purchases. It is a policy
and have them determine exactly how your
ransomware, phishing and social engineering.
Common frustrations include: “Isn’t this what
Helpful information to submit would include
more likely in this day and age than a fire. These
to be there for the unexpected, unthinkable
and post-virus, and a description of how the
large and small companies. In some cases,
“I have paid and paid for this coverage, and the
Review Your Liability Exposures – Have
agent and learned that novel coronavirus (or any other pandemic situations for that matter) is not
a covered cause of loss in their insurance policy.
first time I go to use it – nope, not covered.”
a conversation with your agent about your
These frustrations are certainly relatable and
revised business forecast. Does it make sense
following is not to defend the insurance industry,
payroll? Reducing these exposures you could
in a frustrating situation.
not keep the money in your pocket rather than
■■ This is not actually what insurance is
premium?
understandable. The intention in sharing the
to change your anticipated annual sales and
but to provide potentially unconsidered context
lower your estimated liability premium. Why
for: Insurance is about spreading risk – not
handling a catastrophic and nearly universal loss like a pandemic.
■■ Businesses did not pay for the coverage: Because the potential negative economic
impact with a pandemic is so catastrophic and
wait for the annual audit to return unearned Review Your Auto Fleet – Are there idle vehicles that could be reduced down to
comprehensive coverage only? It’s important to note that this action would remove the liability coverage from the vehicle, so it is equally
vulnerable to an attack than larger corporations. This is because in many cases there are less stringent securities and protocols within the
company when it comes to its IT. This cyber exposure is even more of a risk with many companies moving to a remote workforce in response to COVID-19. A remote work
force can open the door for cyber criminals
by way of home internet. These connections
are less secure and not monitored like robust commercial networks.
Lastly, we are all trying to navigate uncharted waters to the “new norm.” Protect your
business from unexpected Liability or Workers
important that coverage be put back on when
Compensation claims by following state/federal
consider placing a sign on the steering wheel
personal protective equipment issues seriously.
reinstate the insurance before driving.
not allow symptomatic employees to return
Premium to cover this risk would have been
It is hard to acknowledge that few saw this
in advance a communication plan to calmly
would have likely rejected it.
chance you or your agent never considered the
universal, polices were not designed to provide coverage for them, nor was premium collected for the risk. According to industry journals, the estimated monthly price tag for these losses is between $220 and $389 billion monthly.
insanely expensive and, if offered, the market ■■ Insurance covers the expected, thinkable situations: If forced to cover business
interruption losses, many insurance carriers wouldn’t have the funds/premium to meet
the monthly responsibilities and obligations to cover losses that are clearly stated in
their policies (for example, fire, theft, auto
accidents and negligent damages). Within a
matter of weeks, and potentially quite messily, the insurance industry would find itself in an insolvent situation.
the vehicle is returned to service. You might
issued guidelines. Take social distancing and
of the vehicle informing the would-be driver to
Monitor your workforce for symptoms, and do
reality coming. There is probably a 99 percent
outcomes of COVID-19 as a realistic possibility. Hindsight is always 20/20 in situations like this.
until cleared by a medical provider. Establish communicate if and when an employee tests
positive. The “new norm” may be years away. While we are running and learning a lot in the
initial sprint, consider what may need to change
Moving forward, the best thing we can do is
to survive the marathon.
a good conversation with your insurance
About the Authors
learn from our shared situation. Are you having adviser? Are you listening to the counsel your
agent is giving you in other risk areas? While a
pandemic threat seemed unrealistic just months ago, there are known and emerging threats
we’ve been talking about for years like cyber liability.
Russ Davies and Scott Loy are insurance consultants with Andres O’Neil & Lowe, a leading insurance and risk management firm focused on commercial and cyber liability. For more information contact Russ Davies at russd@andresoneilandlowe.com or Scott Loy at scottl@andresoneilandlowe.com or visit www. andresoneilandlowe.com. International Surface Fabricators Association • Vol. 13 / Issue 2 • 31
