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Remote Work Insurance Considerations

SOME remote work insurance considerations: (this list is not all inclusive and you will need to consult other professionals to have a full picture of issues you should address –  IT,  legal, accounting, HR and insurance to name a few

Set up written rules and procedures  – make a telecommuting policy part of your employee handbook and have signed by all employees

Off premises – laptops AND phones – security and access –  work with your IT specialist NOW

Cyber liability – make sure you have a robust policy that covers all locations especially off premises for all computers and laptops, whether owned by the employer or the employee.   Describe very accurately to your broker or insurance carrier how the work for your business is being performed off site and detail what you do (take payments, only make phone calls, etc.)

Set requirements and guidelines for securing the physical and cyber safety and privacy of your equipment and information – i.e. – REQUIRE your employees to log off their computer (and possibly their phone) anytime they are not physically using it and determine how you want the  computer, laptop, phone and other equipment stored/locked when not in use.  Set requirements about who is allowed to use the equipment and the manner in which they can us it.

Set up a policy regarding access to your office network, computer, programs, cellphones or software and how to keep all passwords and access secure.  Password managers, encryption and two factor authentication should be considered along with other protection recommended by your IT specialist.

READ your contract with your credit card vendor!  MANY say that YOU are holding THEM harmless so be sure you know if you are responsible for the potential theft of information if you take credit/debit cards as payment

Business property insurance – do you own the laptops or other equipment that your employees are taking home?  Do you have adequate coverage for all of the equipment you currently have offsite? Does your remote employee have other materials such as samples or product with them that is valuable?

Business income coverage – if the work performed by the employee brings significant income to the employer – does the business income coverage include the remote location from which they work?

Crime – employee dishonesty – is social engineering/funds transfer?

Workers Compensation – keep detailed, accurate records of payroll as of 3/1/2020 – if you have paid an employee who did not work – if you have an employee who usually performs other work but now is working from home in a clerical capacity only – ALL of these may be factors in your monthly or final audits.

WCIRB working on adding telecommuting class – states that have it – use a rate lower than clerical

Employment practices liability insurance – is still needed!  The employer can still be sued

Directors and officers coverage – mismanagement and inadequate protections (such as cyber policies) may be picked up under this coverage

Consult with your broker or insurance carrier directly – do you need to add the locations at which your employees are now working to ALL of your coverage?  How long will they allow you to have employees work remotely without adding their home address to your list of locations? Will they cover losses/injuries from ANY offsite location (picture Starbucks or vacation location)  If you end up with employees continuing to work remotely after the Shelter In Place orders end out when do your policies need to be amended?

MAKE CERTAIN YOUR EMPLOYEES HAVE ALL RECOMMENDED SAFETY EQUIPMENT AND THAT THE WORK AREA IS SAFE. The employer is still responsible for the safety of their employees when working remotely.  Depending on your industry, this may only mean gloves, masks and cleaning supplies – other equipment may be needed – check your industry for other requirements and follow the CDC and OSHA website guidelines which change frequently and be sure you comply with all local and state requirements.  Your Workers Compensation Insurance carrier may have some further safety guidelines you can utilize. Check for electrical safety as well – remind employees to be sure their work area is safe. Recommend smoke alarms, carbon monoxide detectors, fire extinguishers, surge protectors, proper ventilation and ensure that the work area meets safety requirements of local building and fire codes. Are the electrical outlets grounded and not overloaded?

Have them create a designated work area, send you photos, take a work from home safety survey and check with THEIR homeowner/renters insurance carrier as to how their insurance applies to their own property used in business and their liability part of their insurance applies and document the replies.  Most homeowner policies provide little or no coverage for this exposure.

REQUIRE BREAKS –  from a legal and safety perspective – these are critical

Do your employees work in an ergonomic position?  (maybe their couch really is ergonomic J)  Do they need a riser, docking station, headset, ergonomic keyboard and mouse, or separate monitor to maintain proper positioning to avoid injury?  Work with your HR specialist to be sure you are in compliance in all aspects of the work place and rules for employees.  Are they generating other costs to themselves for which you owe them reimbursement (PG&E)?

Business Automobile Insurance – many businesses have vehicles sitting idle and are asking how they can reduce the premium on those vehicles. This is a VERY difficult issue to manage as the vehicle owner is responsible for the vehicle no matter where it is.  If it is parked in a locked, fenced yard and someone climbs on it and falls off, the owner is still responsible.  It is strongly recommended that all vehicles continue to be insured for liability coverage and other coverages recommended by your insurance advisor.

If the vehicle is leased or there are any loans or other encumbrances on the vehicle you will have to make sure you meet the insurance requirements set forth for that vehicle.

Discuss this with your insurance carrier or broker so that you have a very detailed conversation about how your insurance applies. 

Personal Automobile Insurance – are your employees or are you making deliveries in an individually owned vehicle that you were not doing before COVID – 19?  Many insurance carriers are making allowances for this exact situation which is normally excluded from coverage on a personal auto policy – ASK your insurance carrier or broker how your policy will respond to this situation and have your employees do the same!

Remember – the language in most insurance policies is archaic and not designed for the scenarios we are now seeing in the workplace.