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Monthly Archives: November 2015

Holiday Parties and Safe Alcohol Consumption

glasses_on_christmas_tableAs the holidays approach, many companies are having their end-of-the-year celebrations. These events are a fun way to thank employees for a successful year; however, they can also create a number of liability concerns—especially if alcohol will be present.

When planning your holiday party, keep in mind the following tips to guarantee a fun and safe event for all:

Include language about appropriate conduct in your invites. You should also remind employees to drink responsibly, highlighting the importance of moderation.

Limit alcohol availability. Refrain from allowing employees to have limitless access to alcohol. Using drink vouchers is a good way to control how many drinks your employees consume. If possible, hire professional bartenders to serve drinks at your event, as they have been trained to detect when someone has been over-served.

Provide transportation. When possible, offer access to shuttles or taxis. No employee should be allowed to drive home if they are suspected to be over the limit.

Offer alcohol alternatives. Don’t assume that all of your employees will want to drink. Providing nonalcoholic beverages will keep non-drinkers happy and give those who are done drinking something else to drink.

Holding your party off-site at a bar or restaurant can help your company avoid additional legal concerns should problems arise, as liability generally falls on the venue.


© Zywave, Inc. All rights reserved.

Drones: A New Frontier in Risk Management

Drone SWhile hobbyists have been using unmanned aerial vehicles, better known as drones, for some time, businesses are just starting to adapt the technology for their own uses. Drones are creating new opportunities and new risks for businesses to evaluate, and regulators and insurance carriers are scrambling to keep pace.

Despite the fact that drones are readily available, employing them for commercial use is not as simple as just buying one off the shelf. To reap the full benefits of drones and to protect your investment, it’s critical to understand the risks associated with commercial drone operations.


The federal government, through Transport Canada, has primary jurisdiction over the commercial use of drones in Canada. Although Transport Canada has developed specific regulations and guidelines governing the use of drones, certain aspects of the federal Aeronautics Act and the Canadian Aviation Regulations are also applicable to commercial drone operations.

Under most circumstances, Transport Canada requires businesses to obtain a Special Flight Operations Certificate (SFOC) prior to operating a drone. Since 2014, Transport Canada has offered two categories of exemptions to its SFOC requirement—one for drones weighing less than 2 kilograms and another for drones weighing less than 25 kilograms, provided all applicable exemption conditions are met. For drones weighing between 2.1 and 25 kilograms, proper notice of the proposed operation will have to be provided to Transport Canada.

Additionally, drone operators must also observe all other applicable laws and regulations, including the Criminal Code and provincial and municipal laws related to trespassing and privacy.

Physical Loss: Beyond the Aircraft

Businesses will want to consider their potential physical losses carefully. With drones, it’s often the loss of the payload—not the aircraft itself—that can be the most costly.

One of the most widespread applications to date has been in unmanned aerial photography. Businesses in real estate, agriculture and insurance all have interests in surveying and photographing land, and the cameras used to do so can get expensive. Filmmakers, who have also been pioneering commercial drone use, often employ even more expensive cameras.

Because of the increasing affordability of drones, the payload often has a higher intrinsic value than the aircraft itself. Additionally, cameras and other payloads are usually slung below the aircraft, meaning that in the event of a hard or emergency landing, damage to the payload is almost certain.

Planning for Obsolescence

Technology itself could prove to be especially costly in the event of a drone loss. The manufacture of drones is not regulated or standardized, which means there are a number of manufacturers in the market, each adhering to different standards. Many haven’t diversified, and should some technological advancement prove to be too costly for certain smaller companies to adopt, they could potentially go out of business.

Bankrupt or defunct manufacturers, coupled with a lack of industry standards for design, could mean that the loss of a relatively inexpensive motor today would instead be a total financial loss on the aircraft five years from now, when replacement parts are completely unavailable.

Casualty and Liability

As with conventional aircraft, a drone crash could mean a hefty casualty claim. While the crash rate is actually relatively low with conventional aircraft, drones are not subject to the tight maintenance requirements or the stringent operator regulations that make conventional commercial aircraft crashes so rare.

Eventually, mechanical failures and operator errors will likely result in crashes. Businesses, especially those that operate drones in populated areas, should make sure they are adequately covered in the event of property damage or injury to a third party.

Under Transport Canada’s rules, all commercial drone operators are required to carry at least $100,000 of third-party liability insurance. When evaluating their insurance needs, businesses should be aware that most commercial general liability policies exclude the operation of aircraft. Accordingly, drone operators must ensure that they have comprehensive coverage tailored to their specific drone usage.

Theft and Fraud

A couple of benefits of drones—their portability and advanced technology—can also prove to be great liabilities. Small drones are easy and attractive targets to thieves, and the industry hasn’t developed many internal safeguards for stolen drones. Unlike the traditional aircraft industry, which has a tracking system and serial numbers for aircraft parts, the drone industry hasn’t adopted either a tagging or tracking system. In other words, there’s almost no chance of recovering a stolen drone.

Broad Use

Another benefit that could become a potential liability is the flexibility of the technology—that is, a drone’s potential as a broad-use aircraft. In theory, the same drone that photographs a parcel of land for a realtor on one day could be used to survey a hazardous chemical spill the following day.

This kind of flexibility offers a broad number of business opportunities, but each new opportunity brings with it attendant exposures that compound upon one another. Businesses will have to think through how they plan on using their drones in order to make sure that their Transport Canada authorization and their insurance covers each arena of commercial use.

Cyber Liabilities

Perhaps the greatest potential liability comes from the cyber risks posed by drones. The greatest fear is that a hacker might hijack a drone and fly it into a commercial airliner or some other populated location, resulting in massive property damage and loss of life. However, while that scenario is possible, other scenarios are more likely avenues of loss. Digital information—images, videos, data maps, etc.—is a far more enticing target for hackers, and one that an enterprising thief with a little skill and a wireless transmitter might be able to access from a drone flying overhead.

Putting it All Together

New technology always comes with new risks. Protecting your business means understanding those risks and minimizing your liabilities. To evaluate your business’s specific needs, contact an insurance broker today.



© Zywave, Inc. All rights reserved.

Keys to a Secure Remote Work Program

laptop and coffeeAllowing employees to work remotely from home or other off-site locations can increase productivity for workers, reduce costs for the company and create beneficial flexibility to keep operations going if something happened to your business’s primary physical location. However, remote work, or telecommuting, needs to be conducted carefully with the help of established company policies in order to protect workers, your clients and your company.

Balancing the Benefits

For the organization, one of the most tangible benefits of remote workers is the decrease in costs associated with having on-site employees. Workspace real estate can be reduced or kept at current levels, while still allowing your staff to grow. Companies can reduce utility expenses, reducing their overall carbon footprint. In addition, your employees can enjoy a savings on fuel expenses, vehicle maintenance and meal costs.

Many employees flourish in a remote work situation. The flexibility it allows can increase morale and help balance work and home life, resulting in increased productivity. Remote work options also allow a company to employ talent from all over the world.

Having employees who are able to work at home also increases your business’s ability to continue operations in the event of a disaster. If for some reason your physical office had to close, many business functions could still go on.

Start Small

Begin your remote work program on a small scale using a pilot program. Present the opportunity to just a few established employees whose work could be well-suited for this type of environment. Testing this program before a company-wide implementation will help address the inherent risks to business processes and workflows as bumps along the way, rather than wide-spread problems.

While remote work can pose many exposures, most of them can be mitigated with thorough planning and proper execution. Once policies and procedures are established, companies can take full advantage of the benefits that having remote workers offers.

Project Productivity Risk

The change in environment will mean that workflows will need to be adjusted. Different methods of communication and oversight will need to be used to keep supervisors and team members just as connected to remote workers as they are to the workers in the workspace next to them. Employees who are allowed to work remotely should already be in good standing with the company and understand what it will take from them to keep projects moving. Overall, with the right adjustments, productivity should remain the same, if not improve, for remote workers.

Safety at Home

Workplace safety and ergonomics should be just as important for remote workers as for on-site workers at your company. Remote workers should attend specialized safety training or orientation to thoroughly address all possible exposures they’ll face in their new environment, including ergonomics.

When a remote worker starts working in his or her new workspace, a site visit should occur with a supervisor or HR personnel to check that all common-sense safety measures are being addressed. Periodic visits are a good idea to ensure continued compliance. Not monitoring a remote worker’s workspace periodically can allow hazards to develop, putting your company at risk.

Information Security

Information security is the largest challenge for companies with remote workers. Physical loss or theft of devices containing data or access to data is much more likely. Remote workers will usually be in possession of laptops and/or mobile data drives issued by the company to allow them to work with the same systems and information as workers located in-house. The protection of building security, key cards and the watching eyes of other employees will not be able to protect their equipment.

Another aspect of security to be cautious about is using company-issued equipment for non-work related tasks. If laptops are accessed by family members, they could potentially download a virus or spyware. The same could happen if an employee got lax and used their company equipment for personal use. Companies should also be aware of how any sensitive data or documents will be stored and disposed of. Physical print outs especially need to be disposed of properly.

To protect your employee and your company’s interests, be sure that all equipment requires passwords and encryption for access. A thorough policy should be established regarding the line between personal and company property and activity for remote workers to prevent missteps from happening. When establishing the employee’s remote worksite, be sure that any wireless connection is secured and that your company has a policy about using unsecured connections (such as at hotels and other public spaces) for work tasks. Companies can also set up Virtual Private Network (VPN) access for connecting to the company’s networks, to ensure that access is secure.


© Zywave, Inc. All rights reserved.

Handling a Public Relations Crisis

paparazziFew people ever expect to have to deal with a public relations crisis until they are in the throes of one, and by then, it may be too late to respond properly. In addition to resolving the issue that sparked the crisis, your organization will need to handle the fallout stemming from news of the crisis. This may include responding to angry customers or inquisitive reporters.

Public relations employees who are accustomed to little more than crafting marketing press releases may find themselves ill-equipped to deal with an onslaught of tough questions and false information from the public and the media. So how can you help them respond in a crisis?

Before a Crisis

The first and best step you can take to improve how you handle a public relations crisis is to plan your response beforehand.

Start by establishing a crisis communication team. If you’re a larger business, this team should consist of senior management, legal advisors and communications professionals. For smaller businesses, this team may simply consist of you, a public relations advisor and a lawyer you’ve established a relationship with and can call at a moment’s notice.

These individuals will be responsible for creating and executing the crisis response and managing the situation as it unfolds. All planning and communications—internal and external—should be dictated by the team. Nobody outside of the team should make any crisis-related decisions or speak on behalf of your business. Having a unified internal team is essential to maintaining control, which is difficult to recover if lost.

Crisis Prep

Once a team is assembled, prepare a list of reporters, investors, customers, business partners, advisors, employees, third-party experts, community leaders and anyone else who should be notified during the crisis. Have this list in an easily accessible location, along with contact information for your internal crisis team members, for immediate reference.

You should also prepare a company fact sheet, listing up-to-date information about your organization. If a crisis occurs, this information can be distributed to reporters at press conferences or during interviews.

A crisis communication plan is only a good precaution as long as it’s vigilantly maintained, updated and rehearsed. Members of the crisis communication team need to meet regularly to double-check contingencies and make sure all team members are well trained in their roles.

During a Crisis

When a crisis happens, do not wait to go public with any problem that affects your customers. While it may hurt your reputation to reveal an internal failure, the blowback your organization receives from the public will be much less painful in the long run than if you try to cover up the problem. An immediate disclosure will prevent people from questioning your motives for sitting on information and may even earn you some respect from customers who feel they have been apprised of the situation in a timely fashion. You don’t need to have all the answers, but you do need to own up to the problem.

Put together a release to be distributed that describes what happened and the situation as it stands. Let customers know what your next action will be and what changes they can expect in the meantime. Also tell them where to direct their comments. If necessary, hold a press conference to avoid having to deal with multiple media requests.

Control Your Message

Depending on the nature of the crisis, several outside entities may start talking about the situation within your organization. These may include the media, law enforcement, lawyers, banks, hackers, disgruntled customers and social media users.

In the face of all the discussion, you want to make sure your organization is controlling the conversation as much as possible. As reflexive as it might be to choose not to comment or to say only that you are taking the matter seriously, it is not helpful. If the story is big enough, people are going to be talking, and if they don’t get information from you, they will get it from a third party, an internal source or from rumors.

Instruct all employees who are not part of the crisis team to direct requests for comment to the company spokesperson. Talk to reporters and post messages on your social media accounts. If necessary, consider using paid advertising to get your message across. In all instances, however, make sure your message is the unvarnished truth. If any false or inaccurate statements are uncovered, the damage may be practically impossible to reverse.

The best thing you can do to prevent a public relations crisis from turning into a public relations disaster is to anticipate what could happen and plan your response to it. When a crisis is unfolding, the quickest and least damaging way to steer through it is to immediately alert your customers, disclose how it impacts them and deliver timely updates as you work toward a solution.

After the crisis dies down, you can begin the work of repairing relationships with clients and determining how to prevent problems from occurring in the future. But, it’s important to remember that no matter how perfect the fix, if the crisis is handled poorly, it may already be too late.


© Zywave, Inc. All rights reserved.



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