Nearly every aspect of the workforce utilizes the internet at some point throughout the course of any given day. In addition, the majority of Americans have internet access in their homes as well as through mobile devices. Unfortunately, the internet allows for people to conduct themselves unprofessionally or commit crimes, such as identify theft, making unauthorized transactions, or using fraudulent business practices. In order to protect business owners, employees, and every day citizens, many find the purchase of Cyber Liability insurance beneficial.
What is Cyber Liability Insurance?
Cyber Liability Insurance covers a person or group of people from the consequences of unauthorized access to personal information and illegal activity on the internet. Without the need to be physically present for online businesses to conduct transactions, hackers, disgruntled employees, and strangers can cause many complications for a business or person.
“I trust my employees, so should I purchase Cyber Liability Insurance?”
Yes. While you don’t want to appear standoffish to your employees, you will be the one person held responsible for the activity conducted on your premises and online presence. Furthermore, the rise of social media has given millions of people the opportunity to cause irreparable damage to your business’s reputation, which can extend into your personal life outside of the workplace as well. Sadly, the news is riddled with stories of employees deciding to utilize an employer’s resources for their own financial gain, which can include instances of insider trading, promotion of illegal, pornographic material, and driving clients away to other businesses.
In order to protect your investment in your business, or even your own personal life, you need to obtain a policy to cover the risks associated with the use of the internet. While protecting yourself financially, a Cyber Liability policy adds merit to you and your employees’ moral and ethical decisions. It’s better to be prepared for the worst, than to risk financial ruin.
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Starting your own business is the first step towards achieving your dream of self-reliance and fulfillment in your career; however, the chaos of the world will try to bring your thriving business to the ground. You have the ability to prevent undue damage to your business when you purchase an insurance policy for your small business. There are many different types of insurance policies available for small businesses, which range from covering your business structures to your employees’ inappropriate actions, and you need to know what each policy means for your business
Business Property Insurance
If you experience a natural or man-made disaster, a Business Property insurance policy will protect your business from the associated damages, such as from weather, vandalism, or fires.
Liability Insurance
Liability insurance policies protect you against the majority of your concerns as a small business owner. This type of insurance is used to cover any possible issues involving a third party, which includes customers, landlords, products, and even medical expenses. If you were to have a customer trip over your merchandise, a Liability Insurance plan will protect you.
Worker’s Compensation Insurance
If one of your employees becomes injured while at work, you will be held responsible for medical treatment, lost wages, and pain and suffering. Worker’s Compensation insurance shows your employees that you care about their safety while working while protecting your reputation and finances from these unforeseen expenses.
Excess Liability Coverage
Although you purchase a variety of insurance policies to protect your business, you may find that your policy limits do not cover the financial cost of certain claims. In these cases, an Excess Liability insurance policy will provide a cushion above and beyond your existing limitations of liability.
Employment Practices Liability Coverage
This type of insurance for small businesses protects you against allegations of discrimination, harassment, and retaliation.
Life Insurance
Life insurance covers you, your business partners, your employees, or your spouse in the event of death by accident or other circumstances. It will enable your loved ones or friends to continue the legacy of your business.
Health Insurance
You may choose to offer your employees health coverage or purchase health insurance for yourself. The options for Health insurance vary in amounts respective of deductibles, copayments, and limitations. However, some changes have been implemented since the introduction of the Affordable Care Act, so please check with your insurance agent to select a policy suited to your needs.
It can be difficult to navigate the available insurance policies you need for your small business. However, it’s better to be protected against an unfortunate circumstance rather than lose your business and hard work.
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Being a business without workers’ compensation insurance in California is a serious matter. If an employee is injured during the course of business duties and the business is not insured, it does not mean that the business is absolved of its responsibilities. The Uninsured Employers Benefits Trust Fund was established to ensure that employees are still compensated for their medical expenses even if the business did not comply with the law. Using the power vested in this entity, it can pursue many avenues to ensure that the injured employee is compensated, including placing a lien on the business, imposing a stop order so that the business can no longer legally and delivering fines, penalties and jail time.
If you should decide that you do not want to carry workers’ compensation insurance on your employees and one of them becomes injured or sick while on the job, you will be responsible for paying 100% of the cost of their bills. Without obtaining adequate workers’ compensation insurance, an injured or sickened employee can sue your company to obtain the funds necessary to cover their medical bills. In addition, there is the potential that your business will be fined, penalized and even more for not meeting its obligations to its employees.
The California state labor board, the Division of Labor Standards Enforcement, is responsible for ensuring that businesses comply with a range of labor standards, including having an adequate amount of workers’ compensation insurance. If the Division determine that the business was lacking in this regard, in addition to fines and penalties, it is possible that you will serve a jail sentence in the county jail. A stop order is also likely to be issued that prohibits the business from using the labor of those employees who are not covered. It is a misdemeanor to not comply with such an order.
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Nearly all business owners carry some type of insurance. However, if you are carrying a standard business liability policy, it may be worth your time to review your policy and determine if you have employment practices liability insurance (EPLI) coverage. Not all liability coverage includes this important feature.
What is EPLI?
EPLI coverage includes wrongful termination protection for employers. This allows you to file a claim to cover the cost of legal defense anytime you are sued for wrongful termination. This insurance would also pay claims if you should lose your case.
What is wrongful termination?
Wrongful termination claims may be filed by an employee who feels they were fired from their job unjustly. Some of the common reasons why an employee may claim wrongful termination include:
- Age discrimination – employees over the age of 40 may file an age discrimination claim even if they were fired for other reasons.
- Other discrimination – claims may be filed if an employee believes they were terminated because of their gender, sexual orientation or a disability.
- Whistleblower termination – California law makes it illegal to terminate an employee for reporting certain actions including workplace safety, public interest or other activities that may be considered illegal.
- Written contract violations – while California is known to have an “at will” employer/employee agreement, employees who are fired and have written contracts may still be fired under certain circumstances. This may not prevent them from filing a wrongful termination suit.
Minimizing your risk of wrongful termination claims
Keep in mind, the better you document your reasons for terminating an employee, the less likely you are to face wrongful termination claims. Some ways to avoid this include:
- Documentation of wrongdoing – anytime you reprimand an employee it should be documented in their employment file.
- Witnesses can be helpful – if you need to have a conference with an employee about their conduct on the job, it may be helpful to have another manager or supervisor sit in on the conference.
- Consider consulting an attorney – if you need to terminate an employee, it may be helpful to discuss your strategy with an employment attorney first.
Oftentimes, wrongful termination claims are simply retaliatory but having EPLI coverage can make good financial sense for those unexpected claims.
Sources:http://www.business.ca.gov/StartaBusiness/AdministeringEmployees/EqualEmploymentOpportunityLaws/AtWillEmployment.aspx
http://www.calchamber.com/california-employment-law/pages/termination.aspx
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Sexual harassment suits may be filed against a business for any number of reasons. In fact, some employers are surprised to learn that sexual harassment charges have been filed against them because of suggestive posters, suggestive items on display in the workplace or because of lewd jokes told in the workplace. However, under California law, all of these are considered a violation of workplace rules.
Preventing sexual harassment in the workplace
Employers in California who have five or more employees are under an obligation per the laws in the state to provide a workplace where employees do not feel they are subjected to sexual harassment. It is important to note that there are two specific categories of harassment which are “quid pro quo” and “hostile work environment”. As an employer, you should be aware of what each of these terms means, specifically:
- Quid pro quo – when an employee feels they were denied opportunities for advancement or increase in pay because they refused a sexual advance on the job. In some cases, if an employee reports a sexual advance and were subsequently dismissed from their job this may also be considered quid pro quo.
- Hostile work environment – when other employees, regular visitors or others are telling offensive jokes regularly, an employee may feel the environment is hostile. Keep in mind this could mean racially insensitive jokes, jokes of a sexual nature or other behaviors an employee finds offensive.
According to the US Equal Employment Opportunity Commission, during 2011 there were more than 11,000 sexual harassment cases filed. More than 15% of these were filed by male employees. No employer, regardless of size is guaranteed to never have a suit filed against them. It is important to note, that of the more than 11,000 suits filed, settlements exceeded $52 million for suits that were found to have merit. It is imperative to verify that you have the right coverage to protect your business in the event you are sued for sexual harassment.
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Society is different than it was just a few decades ago. It has become contentious. Even a small accident that occurs, with seemingly no one at fault, can result in a large legal endeavor. When that happens, insurance companies enter the fray.
General Liability Insurance Defined
In short: General Liability Insurance is for most types of businesses where there may be instances of bodily harm, injury, and damages inside the business property that were caused due to owner or employee negligence. General liability insurance is dynamic coverage that includes anything from personal injury on the job to product misuse or malfunction.
This type of insurance is vital. Most savvy business owners and new business consultants will tell you that you don’t start a business without some form of general liability insurance. This type of coverage protects your from legal actions, such as suing, for occurrences that may or may not have been caused by you or an employee of your business.
Mitigating Liability Risks at Work
There are ways to mitigate these kinds of circumstances, however:
- Always ensure that quality and product control are handled to the highest standard by employees who are well trained and take their task seriously.
- Keep accurate data of all company records.
- Ensure that your employees are well trained and informed on all safety procedures and protocols that are necessary within the business.
- Never “sit on” an accident report that may result in a liability claim. Always ensure that you make all parties aware as soon as it happens.
However, those are only mitigating factors. You can never ensure or guarantee that something will not happen in the workplace which you and your business may be found liable. That’s why general liability insurance is so important. It is the “front line” of liability defense. While other types of coverages, such as cyber-security insurance and commercial property insurance, cover very specific terms, the general liability insurance has a wider umbrella of protection.
Source: http://sba.gov/blogs
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