Category Archives: Insurance

Protect Your Business from Occupational Fraud

Posted on November 17, 2014 by Marijana Dabic

You may feel that your employees would never steal from you or that your business would never be the victim of theft, but the harsh reality is that nearly every business is eventually victimized by fraud or theft. In this day and age, thieves (including your employees) do not need direct access to cash to steal from you; merchandise, supplies and securities are all fair game. You may also be susceptible to losses if finished products or even raw materials are stolen right from under your nose. Essentially, any product can be a target for thieves if there is an opportunity to make a resale profit.

According to research done by the Certified Fraud Examiners, every year, companies all over the globe lose 5 per cent of their revenue because of occupational fraud. That equals about $3.8 trillion in losses.

To put that into perspective, let’s say you racked up $1 trillion of debt. You’ve worked out an agreement to pay off your debt by giving back $1 every second. How long would it take you to get your debt down to zero? Thirty-two thousand years.

There are things you can do to protect your business from occupational fraud. Here are a few of them:

Become aware of behaviours that would be considered “red flags.”
Train supervisors on recognizing potential red flags and on how to react when they discover them. Employees should be aware that they can report any incidents they see.
Focus your efforts more on preventing occupational fraud rather than recovering from it. Although it may be tempting to take a backseat in trying to prevent these incidents, it will cost you much more to recover from the occupational fraud.
Purchase crime insurance.

No matter the size of your company, employee theft remains a very real possibility, which is why it’s important to take steps to insure your business against losses stemming from an incident. While standard property and inland marine insurance policies provide some protection from criminal acts, they often do not cover losses resulting from employee dishonesty. Crime insurance was developed to deal with the limitations of other policies and extend protection to include the fraudulent activities of employees.

Helpful tips for reducing risk of boiler accidents

Posted on August 22, 2014 by Marijana Dabic

Boiler accidents can be avoided with proper care and maintenance. Reduce your risk of a boiler accident by understanding the common hazards.

Common Boiler Hazards

The most common boiler hazards that lead to accidents are low water levels, excessive pressure and a failure to purge combustible gases from the firebox before ignition. These hazards can cause serious boiler accidents like explosions or fire.

Low water levels in a boiler are caused by improperly functioning low water cut-offs. Water levels that are too low can cause the boiler to buckle or deform, melt down or even explode—all of which can generate severe damage to the boiler and/or to the building.

Excessive pressure in a boiler can also lead to explosions. This occurs when pressure is allowed to build in the boiler. Boiler explosions are very dangerous and can completely destroy buildings.

Fuel-related accidents, like fires and explosions, are also common and occur when combustible gases are not purged from the firebox. Leaking fuel valves can also cause this kind of accident.

Boiler Accident Prevention

Routine maintenance can generally be done by the boiler operator to avoid these devastating accidents. But there are circumstances when a trained professional is needed. These include:

Leaking safety and/or safety relief valves
Contaminated feed water
Steam leaks (in steam boilers)
High stack temperatures (exceeding 177° C)
Insufficient heat for the building
Condensation dripping down the stack or out of the front of the boiler
Constant resetting of controllers and safety devices
Ongoing routine maintenance and inspection is the best way to prevent a boiler accident. Use a checklist when inspecting a boiler to ensure you’re inspecting it thoroughly.

Lloyds Construction Consortium Offering Large Capacity

Posted on August 29, 2013 by Marijana Dabic

ABEX is very excited to offer large capacity for onshore construction projects, through the Construction Consortium at Lloyd’s.

Four of the market’s most experienced insurers of construction risks have come together to form the Construction Consortium at Lloyd’s, offering capacity to lead risks on major projects.

Key Benefits

Up to US$166 million probable maximum loss capacity (approx. equivalent to a US$664 million participation an a sum insured basis)
A lead market for all types of onshore construction projects worldwide.
Flexible participations – any consortium syndicate can lead
Bespoke wordings for clients and their projects
Lloyd’s financial security (A.M. Best A: Excellent, S&P A+: Strong)
Rapid service to meet brokers’ deadlines

For more information on this or other construction products, please contact us.

Employee Data Leaks a Major Cyber Risk

Posted on August 22, 2013 by Marijana Dabic

U.S. soldier Bradley Manning is escorted out of a courthouse during his court martial at Fort Meade in Maryland, August, 20, 2013. (REUTERS/Jose Luis Magana)

The case of Bradley Manning, the U.S. soldier convicted of the biggest breach of classified data in the US history by providing files to WikiLeaks, highlights how employees can pose a major vulnerability to the internet security.

In 2010, Manning turned over more than 700,000 classified files, battlefield videos and diplomatic cables to WikiLeaks, the pro transparency website, in a case that has commanded international attention. Manning was sentenced to 35 years in prison on Wednesday and this sentence is unprecedented in its magnitude for providing secret material to the media. Please click on the link to read more in the Toronto Sun article: Bradley Manning sentenced to 35 years in WikiLeaks case

This case shows how some of the most damaging cyber-attacks involving deliberate policy violations come from within the business, in ways that many employers overlook when it comes to their cyber security. It’s an employer’s worst nightmare—an employee is dissatisfied with his or her job and decides to defraud or steal from the company. Employees can cause enormous damage by committing these crimes.

According to a 2012 occupational fraud report by the Association of Certified Fraud Examiners (ACFE), the typical organization loses 5 per cent of its annual revenue to fraud. It also reported that the median loss caused by fraud was $160,000. For a small company, this could mean the end of the business. Small businesses are more at risk because owners inherently treat their employees like family, leading to complacency and lax security measures. Small businesses also tend not to have anti-fraud measures in place as many lack the knowhow and enforcement capabilities of larger businesses. Nearly half of victim organizations do not recover any losses that they suffer due to fraud.*

ABEX has partnered with WatSec to provide employee security awareness training as part of our Cyber Risk Management Program. The security awareness training prepares every staff member with the critical skills necessary to work productively while being vigilant for potential security threats.

Please contact ABEX and WatSec for more information on how you can effectively manage your cyber risks.

*Source: ©2013 Zywave, Inc

Protect Yourself in a Merger/Acquisition

Posted on April 2, 2013 by Marijana Dabic

Mergers and acquisitions of insurance brokerages reached a record high in 2012, with 291 reported deals in the United States and Canada, according to an annual survey conducted by OPTIS Partners. The previous record was 284 in 2008.

It is important to remember that when mergers, acquisitions and business closings occur and operations are discontinued, the liability of the defunct organization often continues.

Most businesses have a Commercial General Liability (CGL) Insurance policy to cover damages that occur during the term of the policy, but if damages and resulting claims occur after operations are discontinued, a CGL policy does not provide protection.

Sole proprietors that close a business should consider purchasing Discontinued Operations Insurance, which covers damages that occur after the CGL policy has been cancelled.

If, for example, a construction company builds a structure with CGL coverage and then goes out of business, it is still liable for subsequent damages due to defects in the structure, but the entity is not covered by the policy. Discontinued Operations insurance would provide this missing coverage.

Contact ABEX for more information on how to remain protected in a merger or acquisition.