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18 May 2020
Gallagher has warned that rising insurance risks as offices reopen include employees contracting COVID-19 and stresses to staff caused by employers’ poor or ineffective management of the crisis.
“Given the nature and complexity of managing a workforce, employers are quickly responding to many different implications of COIVID-19, including return to workplace planning as the lockdown restrictions are gradually lifted,” the broker says in a Middle Market Business Insurance Update focused on coronavirus issues.
Gallagher says claims arising under Employment Practices Liability (EPL) policies can include impacts that go beyond contracting the disease and could include breach of privacy and emotional distress.
Businesses with variable risk management procedures for different teams and locations could trigger discrimination issues, while loss associated with enforced self-isolation could lead to a claim.
“Most EPL policies contain exclusions for loss related to bodily injury,” it says. “However, there is generally coverage for claims relating to mental anguish or emotional distress alleging an EPL breach.”
Directors’ and Officers’ insurance is another area where the virus outbreak is increasing risks for companies, Gallagher says in a separate Business Insurance & Risk Market Update.
Larger corporates will need to ensure they are meeting Australian Securities Exchange continuous disclosure requirements and should be mindful of regulatory changes and governance expectations, it says.
“It is likely that legislative and regulatory changes will shape the post COVID-19 environment and increased scrutiny will be placed on organisations to understand and implement any changes,” it says.