At a glance
- Personal Accident and Business Travel (PA&BT) delivers vital business interruption protection and helps customers meet their legal obligations
- Additional services offered by the leading insurers can be especially valuable to SME customers
- We explain the importance of Personal Accident and Business Travel (PA&BT) cover how it can help meet wider customer needs
The most valuable assets of small and medium sized enterprises (SMEs) are their employees. Interruption to the workforce – whether through employee travel disruption, injury or death – can therefore result in significant financial loss, with a greater relative impact to smaller organisations.
An overview of PA&BT
PA&BT policies consist of two main parts: Personal Accident (PA) and Business Travel (BT). Although they sit under one policy wording, these elements can be purchased either separately or together. Both aspects offer great flexibility over who is covered and under what circumstances, enabling customers to tailor policies to their precise needs.
PA predominantly offers lump sum benefits for different types of accidents, ranging from injury to death. These are paid direct to the insured (i.e. the business) to be used as it sees fit, which might include reimbursing lost revenues or offering assistance to an employee or their family.
BT provides wide-ranging travel insurance, covering everything from overseas medical expenses to kidnap and ransom. Zurich’s offering is much more than just insurance, it provides a complete support network to help SMEs manage travel risk and deliver exceptional solutions when an incident occurs.
We look at why Personal Accident and Business Travel (PA&BT) should be viewed as an essential cover for businesses of all shapes and sizes.
Protecting your most valuable assets
Wage roll is often an SME’s biggest expenditure, and employees its most valuable resource. However, while most businesses wouldn’t hesitate to fully insure their physical assets, many still fail to adequately protect their human resources.
“Although legally you only have to purchase third-party motor cover, most businesses will opt for fully compressive without hesitation,” says Indu Leefe, Regional Accident & Health Underwriter at Zurich.
“A vehicle can be easily replaced, but its driver is a complex mix of knowledge, skills and experience. Their loss can be very damaging to a business. It’s therefore hard to understand why a business would insure its vehicle but not the person driving it.”
A business interruption issue
Any business will be affected if an employee is unable to do their job for whatever reason. However, the smaller workforces of SMEs are especially susceptible to the potential business interruption and financial loss this can cause.
While larger businesses may be able to quickly find capacity elsewhere in their organisation, the loss of key personnel is likely to result in a greater disruption to an SME.
The fixed benefits provided by Personal Accident (PA) insurance can be used to offset lost revenue or cover additional expenses incurred, such as recruitment and extra staffing costs.
Business Travel (BT) will ensure major expenses are covered when something goes wrong during a business trip. Through the additional benefit of Zurich’s Travel Assistance services, situations will also be resolved quickly and with minimal disruption to the insured’s business.
Satisfying your duty of care
Every employer has a legal obligation to formally risk assess their employees’ work activities and reasonably manage any red flags identified. This includes sending people on business trips, which can introduce a wide range of additional risks for SMEs to consider.
Purchasing a comprehensive BT policy is the simplest and most effective way for SMEs to evidence a commitment to health and safety compliance, and should be viewed as a minimum standard when sending employees away for business.
Don’t rely on employees’ own cover
Many SMEs do recognise the importance of PA&BT cover, but may look to rely on employees’ own coverage, often given free with bank accounts and credit cards. However, these policies are usually far more limited than a dedicated PA&BT policy, and many may exclude business travel altogether.
In addition to demonstrating legal compliance, many SMEs also view holding adequate BT cover as a moral obligation to employees. Requiring employees to hold their own insurance, or asking them to travel with no cover at all, risks harming a business’s reputation.
For example, in autumn 2016 a lorry driver died in his cab while working in Italy. His employer collected the vehicle but told the family that they would need to fund the £22,000 to repatriate his body. The incident was widely publicised and caused the haulage firm significant reputational damage, which would have been avoided had they held even basic BT insurance.
Ensuring cover delivers on its promises
It is important to appreciate the value of opting for a leading PA&BT provider, instead of simply choosing the cheapest cover.
For example, Zurich PA cover offers a £250,000 fund for use in the event of catastrophic injury. This can be drawn upon for a variety of activities, such as retraining, undertaking adjustments to the workplace and home, or employing someone to co-ordinate on-going medical needs. Professional psychological treatment is also available to families following an accidental death.