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Evaluating your business risks

Published on: 18 May 2022 by Michael Lamb

When it comes to the problems a company can face it can often seem like the list is endless. From the danger of a product defect, through to the issue of a staff member giving dangerous advice or injuring themselves in the course of their job, companies are exposed on every front conceivable.

Fortunately, there are many insurance products in Hong Kong and around the world which have been specifically designed to protect businesses against the risks they face. Some of these, dependent on the jurisdiction the company is operating in, will be mandatory purchases under law while others are completely optional.

No matter whether you’re a recent startup, or an established business with many decades of operation, it is never to late to stop and find the gaps in your Hong Kong business insurance protection.

Employee’s Compensation Insurance is Mandatory

Arguably the most important type of business insurance in Hong Kong is the one which is a mandated purchase for every employer; Employee’s Compensation Insurance.

Designed to protect businesses from their liability risk should a worker injure themselves in the routine course of their job, Employee’s Compensation Insurance (also known as EC Cover in Hong Kong, or Worker’s Comp elsewhere) is legally required under Hong Kong law. This applies to anyone, hiring any person, to perform any job, in any capacity – even personal employers who have chosen to hire a maid.

EC Insurance premiums are calculated based of your employee’s salaries but is generally offered to provide coverage of up to HK$ 100,000,000 for any single claim event.

Unfortunately, some insurance companies do not like certain occupations or industries, so if you have been having a hard time obtaining the legally required Employee’s Compensation Insurance for your company then you may be able to find adequate protection via the Employees’ Compensation Insurance Residual Scheme Bureau

Professional Indemnity Insurance is for Advice

Many Hong Kong based companies are in the business of giving advice. CCW Global, as an insurance broker, would fall into this category – we advise our clients on the insurance products we feel would best meet their individual coverage requirements.

However, giving advice comes with some risk. What happens if your client claims that you gave them the wrong advice? Or worse yet, cause that client to suffer a material loss because your advice wasn’t just wrong, it was negligent?

Professional Indemnity insurance, also known elsewhere as Malpractice Insurance, is a type of coverage designed for advice giving businesses to protect them against the outcome of an employee or officer providing negligent advice to a customer.

As an insurance broker, CCW Global is required by our regulator to hold Professional Indemnity Insurance. A number of other industries will also have this requirement, specifically in Financial Services, where licensure is tied to the successful maintenance of a Professional Indemnity Insurance policy. Having said this, there are many businesses and industries for which P.I. Insurance is not a requirement, but could play a vital role as part of a comprehensive risk management toolkit.

I.T. and marketing consultancies, management consultants, digital agencies of all types are just some of the businesses at risk of negligence claims who may not be required to hold this type of coverage, but for whom Professional Indemnity protection could prove invaluable.

Covering Assets in the Office

How damaging would it be to your business if you had a computer stolen? Or if your client files went missing after a violent burglary?

When it comes to risks, many companies overlook the risks to their offices and all the assets contained in those locations. Whether you’re an MNC with offices around the globe, or you’re a startup with your own space at Cyberport, you cannot afford to overlook the risk of something happening to your workplace.

Office Contents Insurance policies are to businesses what Home Insurance would be to families and individuals. Simply put, this type of insurance coverage is designed to protect your company against the loss of, or damage to, things in your office space.

In some cases, Office contents insurance plans go beyond simply the things in your office, and may include more expanded coverage against Employee’s Compensation Risks and even Business Interruption concerns. So, if you’re looking to maximize your coverage while obtaining as few policies as possible, there are worse places to start than looking at your office contents insurance.

Securing Key People with Insurance

The people working in your office are just as important as the tools and assets you are working with. In fact, for a startup or a small partnership, the people working in the company are arguably the organization’s biggest assets.

Unexpectedly losing a key employee at a small or medium sized organization can be a catastrophe, and this is compounded when the loss has been a genuine tragedy like a death. Not only will the organization be grieving over their colleague, but the company will often need to continue without the benefit of that individual’s knowledge and experience. Human beings are irreplaceable, but insurance can assist with continuity following a critical loss.

Key Man Life Insurance is designed to provide a lump sum benefit to a company that has seen a vital employee pass away unexpectedly. This financial assistance can be critical in allowing an organization to continue functioning following a loss, and can even be used as a stop gap to help the organization find the alternate expertise needed for operational continuity.

Business Insurance in Hong Kong

There are myriad risks faced by every business in Hong Kong every day, and no two businesses are ever exactly the same. The risk management tools used for one business may be completely inappropriate for another. One company may want to look at obtaining every type of coverage possible, including offering comprehensive insurance benefits to staff, while another organization could be satisfied with meeting only their legal requirements.

When it comes to protecting your company from any of the risks it faces, only you know what those risks are.

CCW Global has more than a decade of experience in providing businesses in Hong Kong and overseas with the advice they need to best protect themselves. Our expert brokers work with your internal stakeholders to identify and obtain the products which meet all of your corporate objectives.

For more information about CCW Global, or to request a no-obligation, no-cost consultation with one of our expert Advisors, please Contact Us Today.



Author: Michael Lamb

Michael Lamb is an insurance industry professional with many years of experience within the Hong Kong Insurance market. Focusing on APAC coverage issues, Michael is able to provide extensive analysis and insight to a range of pressing topics. Previously, Michael provided insurance broker Globalsurance.com with their most highly valued articles and was a key influence in the development of all the content on Pacificprime.com, Michael has a passion for insurance matched by few others in the region.

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