The GDPR is coming. Time to sit down, relax and take stock

Posted by 3 May, 2018 (0) Comment

This article is about the feeding frenzy taking place, how to avoid it and what to look out for in the run up to GDPR lift off.

 

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The vultures have been circling for some time now.

 

Plenty of people are putting the frighteners on good people that just want to survive the supposed relentlessness of heavily armed Data Commissioners issuing fines aplenty. Which will not actually happen. The ICO simply haven’t got enough resources to do that. Much like other agencies that are not for profit.

 

Speaking of which, it is those that are for profit that we need to be wary of. I’ve received several updated contracts from insurance companies dictating how data issues need to be resolved. My first piece of advice is to establish what your partners expect of you because, whilst the data commissioner might give you 72 hours to report certain types of breach, I am now contractually bound to give others 24 hours notice. Probably because they want the lions share of the deadline to get themselves ready. They also insist on certain types of data security and issue tight deadlines on “data subject access requests”. Cheeky but true.

 

So have you read all your contracts recently?

 

At least some of our partners are decent enough to tell us they’re being updated. Other contracts, like insurance policies, already cater for the change with clever wording. Where it states that they expect you to be complying with the law it actually means that as soon as the law changes, you have to be compliant with the new one. They don’t need to wait for the renewal of a contract to make you keep up with legislation. They’ve already taken care of it.

 

Are you going to read all your supplier or partner contracts? Probably not. Who has the time? I hear you sigh! Keep these in mind when you are changing your policies that are affected by GDPR. There might be a clash. You might want to notify them with 72 hours, yet they might stipulate immediately. Forewarned is forearmed and I don’t think fines are going to cause the biggest headache. I think it will be interruptions to business and loss of reputation and/or clients.

 

Government crack the whip

 

I have a feeling that the government announcement last week, that it would try and reduce the compensation culture by cracking down (again) on so called “whiplash” claims, might fuel the class action culture that Morrisons supermarkets find themselves subject to. There are a lot of companies that rely on that revenue stream (it’s in the billions) and they will switch to the next as quick as they went from PPI to holiday sickness claims. And PPI is coming to an end.

 

Wrap Up: We’re not overly concerned about the deadlines imposed by our supply chain because we have the resources to cope with them. Yet we’re very pleased we know what they are because a data breach causes enough confusion on it’s own.

 

Top Tip: Once you’ve assessed your position, review your contracts to see what else you might need to weave in. This is a once in 20 year opportunity to engage with your stakeholders. Done well, it will build trust regarding data and how you want to keep it safe. That trust is gold dust in the current climate.

Categories : Accountants Insurance,All Risks Insurance,Business Insurance,Company Insurance,Contractors Insurance,Customer Service,General Requirements,Intellectual Property Insurance,Liability Insurance,Solicitors insurance Tags : , , , , , , , , , , , , ,

How to protect risks to cashflow with insurance

Posted by 7 June, 2017 (0) Comment

PROTECTING CASH FLOW2

This blog is about protecting cash flow, especially if those that owe money go bust.

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What if a buyer goes bust?

With the global recession and Brexit, business owners are having to consider the impact this could potentially have on their business.  What if a client goes bust?  If a company is owed significant amounts of money from clients, it is a major risk to cash flow.

Gareth came to us with these questions and more.  He knew exactly what he wanted from an insurance.   Dealing with imports he needed peace of mind that he had cover if stock went missing.  He also needed to know that his invoices were covered if products didn’t reach the consumer. We took time to completely understand Gareth’s business to a granular level.

What if they don’t want to pay?

Business Owners need confidence that they are going to get cover that matched their needs and not be sold an off the peg insurance that doesn’t quite do the job.  After negotiating with underwriters we carefully selected the options that matched Gareth’s broad requirements.

One option included protection against protracted debts or liquidations relating to companies that had been invoiced. It often helps with obtaining quicker payments, from companies that are happy to share the debt, when the risk of a default is backed by credible protection.

What are the risks when reducing risks?

Following up with a meeting to go through the small print and fully explain terms, conditions and exclusions is a must.  We tell it like it is, the good and the bad so our clients can make informed decisions.

The devil is in the detail and it is often a surprise to everyone, including us, when it is interpreted based on a particular business. It’s our duty to actually recommend protection that fits each client and the most appropriate has to meet their needs, rather than provide the dreaded false sense of security.

 

Wrap up; Small print can be seen as an enemy yet there’s a lot that can be learned from it. Read our blogs on the different types of policies available. I used to be surprised at the number of people that told me that they had already covered everything, then sent me documents riddled with exclusions. I now know it is a common occurrence in our sector.

Top tip; Some people find out when it’s too late.Review your debtors regulary and watch out for slow payers and avoid companies that are shown as risks on credit checks

Categories : Accountants Insurance,All Risks Insurance,Business Insurance,Company Insurance,Customer Service,Legal expenses insurance,Liability Insurance,Litigation expenses insurance Tags : , , , , , , , , , , , , , ,

Contracts, Consultants and indemnity‏

Posted by 11 January, 2016 (0) Comment

Jason really was amazing, he managed to find insurance cover for me as a consultant valuation surveyor when no one else could. He  kept me informed of progress continually. I  would thoroughly  recommend him.”

                                –  Robin Smith, FRICS

Getting your contracts in order

 

Robin called me saying “I need urgent assistance”. I’ve won a contract yet they’re asking me for insurance and nobody can provide me with what’s needed. This is something we deal with every week because a lot of insurance providers have placed their products on the Internet and don’t have the facilities to give advice as to what fits.

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The contract wasn’t complicated or onerous yet it was specific. The type of work to be carried out was slightly unusual yet the problem wasn’t the work it was the availability of cover. Robin also had a deadline to meet and so the frustration in finding red herrings all over the Internet was understandable. There were many providers that said they could offer the cover Robin needed but as soon as he scratched the surface they turned and ran in the opposite direction.

 

Insurance and contracts are usually at odds

 

Another challenge for Robin was that the contracts told him the terms and conditions of undertaking the project yet the insurance available has to be compare to the contract to ensure they dovetail. There are clauses in contracts that relate to insurance and there are clauses in insurance policies that relate to contracts.

Most insurances available via the Internet are no good when compared to contracts. The fact that so many insurance providers allow people to buy insurance without speaking to anyone is brilliant. Especially when you need something in a hurry. It’s not so brilliant when you need to speak to somebody and find that the Internet and, in particular the website that you found it on, doesn’t take your calls.

 

Whatever next?

 

Sometimes those awarding the contract start reading the insurance themselves and asking questions. Being cynical, they often ask these questions when they are due to pay an invoice. I’m not saying that they use this as a tactic to delay payment yet, if the insurance doesn’t meet the requirements, they will delay payment.

This happens most often when small businesses are working with a large company with an in-house legal team. They accept the insurance documents and only start checking the details when they are due to pay. This is so common we make sure that the insurance stacks up before it’s issued rather than suffer the pain of the late payment at a later date.


Wrap up
; Temptation to accept a contract with a large company is great. The offer may seem fantastic yet their requirements can offer the water down the profitability.

Top tip; Make sure you check the cost of the insurance before you negotiate your fees or payment terms. You might need insurance for a contract yet you don’t want to end up with zero profit.

Categories : All Risks Insurance,Business Insurance,Company Insurance,Contractors Insurance,Design Insurance,Intellectual Property Insurance,Legal expenses insurance,Liability Insurance,Patent Insurance,Trade,Trademark Insurance,Uncategorized Tags : , , , , , , ,

Say it but don’t blame me

Posted by 2 May, 2015 (0) Comment

Sometimes it’s best to help your prospects understand what you offer that your competitors don’t rather than trying to highlight the inadequacies of your competitors. This is specially the case when the comments you make are in public especially when your competitors get angered easily and or have very deep pockets or in-house legal teams. This article explains what happens when someone is unhappy  with what you say about them, how to avoid it and what you can do about it.

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I have a client who has produced software that is absolute outstanding and reduces the amount of time you and I spend waiting for organizations to answer our calls. It also reduces the number of staff call center require and I think it’s a product that provides everyone with a benefit. They have nearly 1 million subscribers to their app so they must be doing something right.

There was a time, before they appeared on “Dragons Den”, that they were looking to generate a buzz about their business. They talked to a marketing consultant and eventually persuaded to use a marketing expert who’s specialized in generating PR for technology based businesses. It all sounds great, everything heading in the right direction.

 

We didn’t say that did we?

 

The marketing expert had decided to seed the press and other relevant forums with explanations about the different waiting times that people experience when calling well known companies. In theory these companies were not competitors to our clients. They were irked even angered, to find them self at the top of a table highlighting which companies leaves callers on hold for the longest time. The angriest was a particularly large company in the health industry and they decided to issue a letter asking our client to explain exactly where they got their information from and asking them to remove any reference to that company from the public domain. This was an understandable reaction to an article that was supposed to improve the profile of this client yet it just sort to anger a party they didn’t needed to anger and caused many other problems internally. The initial panic should never be underestimated when you get a letter from a in-house lawyer because they have so much time on their hands to deal with such issues.

naturally my first question to my client was had they actually made the points that the in-house lawyer objected to. Their answer was it wasn’t us. Yet when I used Google I found the article was credited to them. At which point they said it was an outsourced marketing expert who had put these articles together. I asked if the marketing expert had provided evidence of their insurance. Blank looks all round. I asked if the marketing expert’s research had been checked by my client. More blank looks. I asked if the marketing expert had used an specialist to research the details they were using. The blank looks continued.

 

Shall we tell them it wasn’t us.

 

This was the comment my client made next and I asked them if they thought that would send the complainant off towards the marketing company and they realized that was probably never going to happen. If that were the case, everyone would simply say someone else did it in our name and no one would ever seize or desist when the lining someone. Fortunately they didn’t need to have this conversation because we had already provided them with a legal defense if allegation of liable defamation or breach of confidentiality were leveled at them yet they still had learned a valuable lesson about suppliers. These days very few businesses are self contained. Nearly every company I know relies on a employee or another organization to help them deliver their product or services. However not all such businesses are as careful as they should be and you can either be guilty by association or considered guilty because something is done under your umbrella.

Top Tip:
Check your suppliers carefully if they have insurance and it is fit for purpose you can give them a free rain, which makes your life easier.

Wrap up:
If they don’t have insurance you shouldn’t be dealing with them. Because at best, your insurance premiums will creep up as your suppliers make mistakes. That’s like buying car insurance and allowing the worst driver you know and drive even though they are already banned.

 

 

Categories : Business Insurance,Company Insurance,Liability Insurance Tags : , , , , ,

Efficient insurance isn’t always friendly

Posted by 23 June, 2014 (0) Comment

This article is about how improvements in technology should help providers improve the service to their clientèle. Read on to find out how IT has made life easier, where it has failed, and the backlash that is “in the post”.

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Treating customers fairly?

 

Recently I have been learning how to use a new IT system which will increase our efficiency and profit. The people showing us how to use the system are terribly nice and say some nice things, yet also some very surprising things. One that really did surprise me relates to the way the system allows us to meet all the compliance regulations that are bestowed upon us, by the FCA (Financial Conduct Authority) I was pleased to find that the system made our life easier when ticking the compliance boxes.

It was during a discussion about “treating customers fairly” (TCF) that I was so surprised. TCF involves doing what it says on the tin – making sure that the customer is at the centre of what you do. This ensures that they are well treated and their aims are met whilst your business meets its aims too. For me, this is the most valuable thing you can do in a business, because customers are always right and when they are wrong, its usually because they have not been well informed. This is a statement that most business owners don’t want to hear, yet when they are the customer they realise that it’s actually true.

What’s the surprise?

 

The comment that surprised me so much was after I complimented the trainers on showing us how to add efficiency into our compliant processes. Our training lady announced that no one usually cares about this, to which I exclaimed “pardon!” because I couldn’t believe that a sector so beaten and bowed by criticism still fails to take its customers’ rights seriously. I enquired what the lady meant by “no one usually cares” and she reiterated that all the other people she trains (all is probably an overstatement) find ways to avoid ticking the compliance box of TCF. I am not surprised that this happens, but I am surprised that it is an industry wide problem. However, it does explain one scenario that has puzzled me somewhat.

Why is it important?

 

When I first went “alone” I carried out research and found that a healthy percentage of people that had purchased insurance were not sure that it was right for them. This meant there were people who would find our service useful. This gave us immense confidence as we ploughed our furrow and provided a service that isn’t available to all. It still isn’t available to all, because we could not possible service the entire commercial insurance buying public, not by ourselves. But watch this space. We have no immediate plans to dominate the UK, yet what I have discovered over the last few years has shown us that the vast majority of people who buy insurance are not treated fairly. There is work for us to do in changing that. It is a challenge, but one I am ready for.

Wrap Up: Not all insurance policies are the same. Not insurance companies are the same. Not all businesses are the same. So ensure you get what you need, before you need it.

Top Tip: If ever you do have a problem with insurance ask your supplier how they are treating you fairly, whilst dealing with the problem.

 

Categories : Accountants Insurance,After The Event,All Risks Insurance,Building Contractor,Business Insurance,Company Insurance,Contractors Insurance,Customer Service,Design Insurance,Domian name protection,General Requirements,Health & Safety,Intellectual Property Insurance,Legal expenses insurance,Liability Insurance,Litigation expenses insurance,Patent Insurance,Personal Insurance,Solicitors indemnity,Solicitors insurance,Trade,Trade Secret Protection,Trademark Insurance,Uncategorized Tags : , , , , , , , , , ,

Flatterers deceive UK start-ups

Posted by 19 April, 2014 (0) Comment

A spectacularly large US company flattered a UK start-up with a huge contract which was eventually signed and secured. This would give them the capital they need to multiply their success. The contract wasn’t exclusive and the start ups web application was valuable to many similar companies. A fantastic “result” and only two types of insurance were required by the US company.

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Contractual responsibility

 

The contract issued by the Americanclient had 2 pages making direct reference to the type of due diligence, risk management and business insurance required of the start-up. The rest of the contract revealed 26 further liabilities and requirements that were, or would become, necessary.

Not all were manageable for a small company with limited cash flow. The really fine points of the contract referenced this exact point and made it clear they would take full and furious legal action if something went wrong. Ouch, a soft landing is required so we received an introduction.

Part of the liability related to the website, which was provided as a service, and had to be operational 99.9% of the time. The US company staff would be trained to use it and then supported 24/7. It had to work and the contract made it clear that they would want compensation for any downtime over 0.01% in any one year. Keep in mind that one way to compensate is not charge fees that are due.

Penetration testing must be the answer

 

It helps work out weaknesses today yet doesn’t account for advances made by hackers tomorrow. IT Systems security methods of suppliers aren’t always reliable and data theft was the main concern of the US client. They made the UK startup contractually liable for the costs of notification to the relevant authorities and those whose personal data is compromised.

This is a really tough figure to try and quantify because few own up when they have a data breach so the statistics cannot be compiled. Contrast that with fires where it is easier to quantify losses.

That won’t change just because it becomes a must to do (new regulations are due to land in the EU in 2015). So if some Herbert got at the data, the US company would have to spend to meet US regulations and the UK start-up could be ruined by the losses. Identity theft costs vary from person to person so it really is a difficult number to calculate.

Legal liabilities change across borders or state lines

 

The chances of a breach are minuscule, the costs ridiculous. The damage to brand immeasurable. Get a lawyer to get legal on your contracts and they’ll close the gaps. Some clauses don’t hold water in the UK yet US companies issue proceedings where they want. The contract formed a vicious circle when the statement of work and suppliers agreement were reviewed together. No stone had been left unturned and the US company had a fair minded legal team. That is not always the case.

However, there was a liability of millions and the supplier of the application’s infrastructure were only going to cough up £182k if they failed to maintain their supply. Worse still, the infrastructure wasn’t easy to transfer to a new supplier and a 30 day window tied the start-up down. No fix in 30 days and the US contract terminated automatically. And further contracts would not have been issued by them or anyone else.

We deal with cyber risk every weekly basis. It rarely touches the smaller business, yet their suppliers are at risk. Cloud sounds great yet it is not as solid as your own database with your own security. The solutions are a contractual nightmare.

Wrap up: It is not unheard of for a large company to issue a contract to a start-up, allege an error and drown them in legal proceedings. This is because they can then strike a deal which leaves the start-up Directors free of debt if they give up their Intellectual Property. Only in America? No! Uk companies do this too. Does Directors protection work in these cases? No! See why here: http://www.cobinecarmelson.com/wp-content/uploads/2011/11/What-are-Directors-real-risks.-CCLv5-URL.pdf

Top tip: One digital games company signed an NDA and found the other signatory copied their ideas and started selling their titles. It cost £300,000 to force them to stop and compensate the original designer. There is no point getting someone to sign an NDA unless you have the means to enforce it !

Categories : Accountants Insurance,All Risks Insurance,Business Insurance,Company Insurance,Design Insurance,Domian name protection,General Requirements,Intellectual Property Insurance,Legal expenses insurance,Liability Insurance,Litigation expenses insurance,Patent Insurance,Solicitors indemnity,Solicitors insurance,Trade,Trade Secret Protection,Trademark Insurance Tags : , , , , , , , , , ,