AN OVERVIEW OF INSURANCE COMPANIES

Insurance companies compensate their clients for damages incurred if they are protected as defined in a signed contractual agreement. Aviation coverages, automotive liability and physical damage, bonds, crime, errors and omissions, general liability, inland, and ocean marine, professional liability, real and personal property, and workers' compensation are all available from property and casualty insurers. Accident, health, and life insurers provide insurance to individuals or corporations on a group basis for their personnel. Customers can purchase policies directly over the phone or the internet, or through workers, agents, or other financial institutions such as banks or credit unions. Customers' policy premiums and investment gains are how insurance firms make money. Insurers are controlled at both the federal and state levels, with restrictions on the types of insurance that may be provided, the rates that can be paid, the underwriting processes that determine eligibility for each type of coverage, and the contract language. Financial requirements necessitate sufficient capital to cover losses and unearned premium reserves. Insurance firms may provide financial planning, loss control inspections, premium financing, risk management, and safety programs to its consumers. To gain brand awareness, some offer services such as health exams at public places such as street fairs or festivals, highway roadside services, or sponsorship of public events.

Property Exposures

Electrical wiring for computers, printers, mail sorters, and other office equipment, as well as heating and air conditioning systems, are major property risks. All wiring must be up-to-date, well-maintained, and adequate for firm operations. Overriding circuit breakers requires inaccessibility. Even a little fire may ruin electrical circuitry with smoke, water, and heat. Most insurance companies use digital records, but paper files should be kept in fireproof cabinets. Install equipment and paper-specific fire suppression systems. If the company has a cafeteria, cooking surfaces should be protected with extinguishers, alarms, and shut-off valves. Regularly clean grease filters. Regularly repair and maintain protective equipment. Physical barriers to prevent after-hours entry and an alarm system that alerts a central station or the police should be established. Customers expect fast response after a claim, therefore catastrophe readiness is key. Since the insurer must continue operations after a loss, further expense coverage should be considered.

Crime Exposures

Employee dishonesty is the primary source of crime exposure. If the insurer takes premium payments on the premises, there may be a money and securities risk. To address these risks, insurers require a Financial Institutions Bond. Anyone who will have access to the company's accounts should have their background checked. There should be a separation of tasks between those who handle monetary deposits and receipts and those who reconcile bank statements. Outside auditors must monitor and audit the books on a regular basis to prevent and discover issues. Computer fraud controls and programming should be evaluated. Due to the substantial financial assets maintained by most insurers, extortion is becoming a major worry.

Inland Marine Exposure

Inland marine vulnerability stems from accounts receivable since premium payments may be spread out throughout the life of policies, computers for processing policies and claims, and valuable documents and records for customers', claimants', and regulatory information. Backup copies of all data, including computer records, should be produced and kept off-site for ease of restoration in the case of a loss. If adjusters seize a claimant's property for salvage, bailees coverage should be considered. If there are paintings or statuary in important places such as meeting rooms or lobbies, fine arts coverage may be required. There may be signals that necessitate more complete covering than that provided by property forms. Property in transit coverage will be required for things that claims adjusters or inspectors transport to inspection or loss locations, such as a disaster area.

Premises Liability Exposure

Most transactions are done online, by mail, phone, or at the customer's or claimant's company or home. Clients should be limited to specific locations to minimize slip-and-fall injuries. Steps and uneven surfaces must be indicated on floors, staircases, and elevators. Exits must be well-marked and have backup illumination in case of power outage. Handrails, well-lit, signposted, and well-maintained steps are essential. Parking lots and walkways must be in good shape, level, and free of slips and falls. The parking lot should have as much protection as the neighborhood. Claims adjusters and inspectors visit clients' houses and project sites, including sensitive areas. They may work with clients' customers to understand operations. Training, procedures, and regulations must cover off-site behavior and confidentiality. Quickly address adjuster and inspector complaints. Personal harm risk originates from privacy breaches, private information leaks, and underwriting prejudice.

Product Liability Exposure

Due to the fact that insurance goods supplied to clients are intangible, the risk of product liability is extremely minimal. If the firm sells goods such as t-shirts or advertising novelties to its representatives or consumers, there is a possibility that there will be some minimal exposure.

Directors’ and Officers’ Exposure

Due to the conflicting goals of multiple stakeholders, including investors, policyholders, claims, workers, and regulators, directors' and officers' risks may be significant. When the economy is struggling and there have been well-publicized abuses in the financial services sector, directors and executives are more likely to face legal action for the consequences of their choices. Officers must have in-depth understanding of the insurance industry, the ability to compete profitably, and the capacity to manage continuing operations well. Directors ought to be made up of people with diverse commercial interests and no conflicts of interest.

Professional Liability Exposure

For insurance firms, professional liability risks from their accountants, actuaries, attorneys, auditors, claims adjusters, and inspectors can be substantial. To swiftly identify and correct mistakes, there must be checks and balances in place. To stay current with industry developments, all professional-level staff must have substantial educational backgrounds, ongoing training, and license (if necessary).

Automobile Exposures

Employees driving errands may only have hired and non-ownership automobile exposures. If workers use their own vehicles for work-related purposes, the employer should check each year to make sure they have insurance with sufficient coverage levels. Larger insurers will often assign officers, inspectors, claims, and sales personnel to fleets of cars. If an employee does not have a business vehicle assigned to them, pool automobiles could be available. Employees and their families should be allowed to utilize any owned automobiles for personal and authorized purposes. Any driver must possess a current driver's license and an MVR that is suitable. Vehicles must be kept in good condition, and documents must be stored in one place.

Workers Compensation Exposures

Because there are so many different roles within an insurance firm, workers' compensation exposures are often minimal. Office workers who spend the majority of their time on computers are at risk for repetitive motion ailments including carpal tunnel syndrome as well as eye and neck strain. The ergonomic design of every workplace should help to lower the likelihood of such accidents. When leaving the workplace, employees are exposed to over-the-road hazards, especially in regions with heavy traffic. The activities of the clients and claimants they serve expose claim agents and inspectors to a range of unknown exposures. Loss sites may provide specific risks owing to work being done in compromised or destroyed structures. It could be required to use safety gear like non-skid ladders, hard caps, or eye- and ear-protection.

Minimum Recommended Coverage:

Building, Business Personal Property, Extra Expense, Breakdown of Equipment, Financial Institutions Bond, Receivables, Computers, Property in Transit, Important Documents and Records, Directors' and officers' liability, general liability employee advantages, Workers' compensation, professional, umbrella, hired, and non-ownership vehicles

Other coverages to consider:

Flood, Extortion, Computer Fraud, Employment-Related Practices, Cyber Liability, Business Auto Liability, and Physical Damage