2 MIN READ
Business managers face all sorts of risks. Sometimes they’re unavoidable. But the risks – which can result in costly lawsuits, sagging profit margins and irreparable harm to a company’s reputation – can at least be mitigated if you have the right safeguards, planning and insurance coverage in place.
Here are five top risks businesses are facing plus how to minimize them:
1. Private companies are grappling with a cybersecurity threat that’s only grown in recent years with no sign of letting up.
What you should do now: Corporate risk managers should work closely with their compliance department heads to better respond to the latest regulatory requirements regarding potential cyberthreats.
2. They’re facing increased scrutiny from a variety of federal and state agencies.
What you should do now: Make sure you have a comprehensive insurance policy to protect directors and officers from regulatory risks.
3. Private businesses face workplace complaints from employees, including age, racial and disability discrimination; sexual harassment; and retaliation.
What you should do now: Ensure preventative and mitigation measures are in place including documented hiring procedures, an up-to-date handbook, and proper training for employees on workplace discrimination and harassment.
4. They face claims involving a breach of fiduciary duty such as mishandling employee retirement accounts or benefit plans.
What you should do now: It’s essential that employers fully understand some basic rules and regulations, specifically the Employee Retirement Income Security Act (ERISA). Learn more from the U. S. Department of Labor.
5. Private companies can be exposed to illegal background check lawsuits, which have become increasingly common.
What you should do now: If you perform background checks as part of your hiring process, make sure to comply with the Fair Credit Reporting Act and any state laws that may apply.
To learn more about protecting your private companies, visit https://www.argolimited.com/argo-pro/product/private-company-protect/
Rich Edsall is senior vice president, commercial management liability and head of Private Company at Argo Pro. He is tasked with growing Argo’s Private Company books of business. Rich was previously senior vice president of Chubb Insurance, focusing on directors and officers liability products. Rich is also a member of the Professional Liability Underwriting Society (PLUS).
Argo Pro, a member of Argo Group, is a leading provider of professional lines insurance products and services that can accommodate medium and large organizations on an admitted and nonadmitted basis. Through a single operating platform and a robust network of appointed wholesale and retail distribution partners, Argo Pro offers a broad, customizable portfolio of errors and omissions and management liability insurance solutions. Argo Pro maintains offices in Chicago, New York City, San Francisco, Scottsdale and Hamilton Township (New Jersey).
