Businesses of all sizes face a multitude of risks every day, but a question many business owners fail to answer is how they would cope in the event of a major regulatory crisis.
This goes far beyond the mere mechanics of how a business responds to a crisis incident, such as the death of an employee, a possible environmental crime, or an outbreak of food poisoning.
It includes determining how a business can protect its income, reputation, and its very existence in light of a civil, or even criminal, investigation and the potentially huge legal costs and relentless media scrutiny that would accompany it.
A recent example is the manufacturer who employed a waste disposal contractor to dispose of old oil.
Contrary to the manufacturer’s expectations, the contractor dumped the oil in a field and then became untraceable. The Environment Agency brought criminal proceedings against the manufacturers’ directors and considerable defence costs were incurred to achieve their acquittal.
Another example is the small UK company involved in building work in France. One of its sub-contractors died from a fall at the site and a director of the company was prosecuted in France for manslaughter, incurring a large amount of defence costs in understanding the foreign procedures and achieving acquittal.
While robust risk management processes can minimise liability, the chances of a business finding itself the subject of a regulatory crisis, and facing huge legal costs as a result, can never be eliminated.
This is the reason Harrison Drury has partnered with a number of other professionals to act as an adviser for an insurance-backed regulatory product. We have teamed up with corporate insurance specialist Sentinel Corporate Risk, Aegis, and Freshfield Marketing Communications to offer the product, which is backed by global insurer AIG.
This facility gives businesses vital cover in the event they become the subject of investigation by a regulatory body, such as the Health and Safety Executive (HSE), Environment Agency or local authority trading standards.
Taking out the policy offers businesses instant access to a team of legal, insurance and public relations experts who can provide vital hands-on support in the event of incidents such as corporate liability, HSE investigations, injury and property damage, or financial misconduct, and Employment Tribunal claims, to name just a few.
The financial cost of these vital services is met by the insurer, effectively giving you a crisis response team, allowing you and your staff to get on with the smooth running of your business.
If you require further information on the regulatory insurance-backed product, or any other regulatory legal matter, contact David Edwards on 01772 258321 or David.Edwards@harrison-drury.com