Adopted a hybrid work model? Make sure your insurance policy covers work-from-home risks

Many South African businesses have returned to 'business as usual' and have their full staff complement back working in the office. However, some industries have retained work-from-home business models. While this does have benefits, it also presents its own risks of which companies must be aware when structuring their business insurance.

Research conducted by South African jobs portal, CareerJunction, in 2023 showed that only 3% of jobs listed on its platform offered remote working opportunities. Of that 3%, the majority (59%) were in the IT sector, followed by business and management, finance, admin and sales.

CareerJunction noted that work-from-home opportunities were more prevalent in industries where there was demand for specific skills or where the work was easily done remotely.

Those firms still adopting hybrid models in South Africa (and those that might follow this international trend in the future) must understand the impact of remote working on their business insurance, and make provision for the additional risks associated with working from home.

Some of the major risks include:

1.     Cyber liabilities:

Your business's cybersecurity is watertight, but what about your employees' home networks? Home wi-fi connections are easier to attack than corporate IT networks, which could spell disaster if sensitive data or intellectual property is illegally accessed or falls prey to ransomware.

2.     Property theft:

In South African, home invasions remain a critical risk for homeowners and more recently, employees. Continuously transporting laptops and other company-issued mobile devices poses an additional theft risk, and heightens the risk of equipment being damaged or lost. Employees responsible for keeping physical stock of goods who store this at home face a further risk of stock theft or damages.

3.     Home injuries

Your employers' liability insurance covers damages (including injury, illness and death) sustained by employees at work. Not all policies extend to include disability or death that occurs during the working day at remote sites. A personal damages claim without the correct insurance in place can devastate a business, so this factor is critical to reassess.

4.     The impact of loadshedding

Offices may be equipped with UPS or off-grid solar systems, but most residential households are not, and bear the full brunt of loadshedding. Home security systems, security cameras and electric fences all rely on battery back-ups, which if not restored in time, can pose a security risk for company equipment. Laptops and other electronics are also sensitive to power surges, for which most homes do not have adequate protection.

To ensure your business insurance policies adequately cover remote working employees, sit down with your broker and assess these and other industry-specific risks that could affect your cover.

Don't forget to include in your policies special equipment that has been purchased to help mitigate any of these remote working risks, such as buying UPS units to offset loadshedding. Such equipment must also be covered in your current business policies.