Considering Risk Management in 2021

By Allianz and Get Indemnity


Many companies have been hit hard as a result of the pandemic and consequently are struggling to open for business or even remain solvent.

The situation is further compounded by the ongoing complexity surrounding Brexit. Recessionary trends can lead to increased threats to businesses and have an impact on the traditional insurable perils that organisations and individuals face. Highlighting, why company’s need to ensure they have sufficient business insurance.

Why risk management is important?

Paradoxically, at a time when risk management is most needed, some organisations de-prioritise it due to financial pressures. Businesses might look to save costs by removing roles such as risk/health and safety managers or making cuts to training programmes. 

This can prove a false economy and lead to greater damage and business disruption further down the line. Fairly simple security measures can help reduce the risk of break-ins and theft, such as CCTV, intruder alarms and the use of locks (including padlocks) to gates, shutters and external doors.

Property risk management

Incidence of theft tends to increase, including physical items (cash, cars, tools) and online identity theft and fraud. Construction sites can be targeted, with large items of construction plant acting as a lucrative lure for criminals. 

Further, with many commercial properties vacant, there can be increased risk of escape of water, especially as we move into the winter months. This is partly because water systems are more susceptible to freezing, but this can be exacerbated where leaking water systems are left running for long periods without the property owner’s knowledge, thereby driving up the cost of a claim. 

Vacant premises may also face an increased risk of vandalism, malicious damage and fire or arson; additionally, they may be used as a base for illegal activities or become occupied by squatters. 

Working from home

The large-scale move to a remote working model during the Covid-19 pandemic is likely to signal a more permanent shift towards this type of working for many, leading to certain potential implications from an insurance perspective. 

With more staff located offsite, traditional perils, while still representing risk, are less likely to result in a total loss or disruption to business. This is due to the wider geographical spread of risk, where staff and IT equipment are no longer concentrated in one location. 

However remote working also engenders new, less tangible risks, in the form of enhanced cyber insurance threats. The potential for thousands of WiFi routers in employees’ homes across a wide geographical spread, opens up new vulnerable access points for cyber criminals. It’s expected that cyber is likely to continue to emerge as a key business peril. 

Liability risk management

Employers retain the same health and safety responsibilities plus duty of care towards their employees, regardless of staff being based offsite. Recent data showed that more than 20% of people were reporting high anxiety levels as a result of Covid-19, claiming that the move to working from home had impacted negatively upon their work.

Organisations could see also more employer’s liability insurance claims related to musculoskeletal disorders where employees maintain they’ve developed these conditions as a result of unsatisfactory physical working conditions. 

Employers therefore will want to employ procedures for ensuring the welfare of their staff, such as keeping in regular contact, monitoring workloads and providing advice on completing home workstation assessments (such as Display Screen Equipment or ‘DSE’ assessments). 

Company director’s risk

Business leaders could face an increased risk of directors’ and officers’ liability claims as the unstable economic and political situation persists. Company directors face an ever-broadening raft of risks and exposures as a result of decisions they  take; such claims may stem from decisions relating to climate change, failure to ensure adequate business continuity or managing employee wellbeing during the pandemic. 

Similarly, those in the professional services sector may become a target, particularly professional advisers, where it’s alleged their advice has led to poor economic performance. 

The role of technology and data

The insurance industry has access to huge and increasing amounts of internal, third party and real-time sensor data which, when properly harnessed, can help create much richer and more accurate risk profiles to better manage risk. Internal data can be leveraged to reveal more and more insights, to help good decision-making through technologies such as machine learning and AI. 

Examples of other new data range from telematics data (sensor data) in motor insurance lines to geospatial data (third party data) for helping determine flood risk, for example. Technology also provides more methods for capturing customer data, not least through social media platforms such as Facebook and Twitter, which can influence assessment of risk and therefore underwriting decisions - but these sources must be used carefully and in a way which is both transparent and ethical. 

AI and machine learning are touted to play a growing role in managing risk. One example is the area of lone working where individuals may be working at height or in physically challenging circumstances. 


Traditionally commercial insurance has been associated with compensation. However, insurers and brokers are increasingly embracing a role as proactive risk managers, equipping their customers with information to help reduce risk in the first place. Whilst the nature of risk will continually evolve, the basic principles of risk management remain fairly constant. 

These include having effective measures and plans in place for risk identification, analysis and control. This, combined with a robust business continuity plan and the right insurance cover, can provide peace of mind that an incident should not bring business entirely to a halt. 


by Get Indemnity™ and Allianz Insurance

This guide is for information purposes and based on sources we believe are reliable, the general risk management and insurance information is not intended to be taken as advice with respect to any individual circumstance and cannot be relied upon as such.