Date: Feb 01, 2013
Magazine:
February 2013 Fiscal Cliff Averted

These days business has become a global activity, even for small companies that operate on a local basis.  Suppliers and buyers can be found almost anywhere in the world.  Cell phones and the internet make it possible for a company to operate on a multi-national basis even when most of its activity might be found in a regional area or state.

This ability to communicate effectively and immediately with almost any other company in the world has made business more efficient and more profitable, as companies have been able to find cheaper resources for their needs and buyers of their products in remote, isolated areas.  With this international trade has come the need to travel widely around the world to meet face-to-face with far flung suppliers, buyers and new business partners.  This creates new exposures for companies that previously operated entirely within the United States.

With these changes, many companies do not understand or realize there are laws that require them to provide special care and protection for their employees who travel internationally.  These laws are called “Duty of Care” laws.  Most modern nations, such as the United States, Canada, Western Europe, the United Kingdom and Australia, have enacted these laws and the courts have stringently enforced these statutes when an employee is injured or killed while traveling on business.  Business owners need to be aware of the laws and take steps to protect their employees from harm while traveling overseas.  Companies can also purchase insurance coverage to secure additional protection for the employees and the company in the event of a serious event overseas.

A recent survey of almost 5,000 business by International SOS, one of the world’s leading international healthcare, medical assistance, and security services companies, found that 60 percent of businesses had employees who traveled to high-risk destinations at least once a year.  Twenty percent of these indicate they travel to these risky locations at least five times a year.  If a company has numerous employees traveling overseas, the risk to health, safety and security can grow exponentially.

Just keeping track of the number of employees exposed in foreign countries can be daunting for some international companies.  Most companies may be conscious of the exposure their employees face overseas, but many are not aware that Duty of Care laws make them legally liable for the health and safety of their employees while traveling abroad.  Sometimes employees will mix personal travel and activities with business travel and it can be difficult to discern if the business is responsible for a particular activity of an employee.  Generally, if the business paid for any part of the activity, it can be held responsible for the health and safety of the employee and therefore needs to take steps to protect them.

While traveling overseas, employees are essentially working at all times and therefore need to be covered for workers’ compensation injuries.  Typical workers’ compensation coverage does not automatically provide coverage for workers that travel out of the country.  In order to guarantee that workers have coverage for their work-related injuries, companies should secure an international workers’ compensation policy that will provide the needed coverage for those workers.

Medical care is also important while traveling overseas, since workers need to be able to get proper medical care should they become ill.  A special medical policy can be secured to provide this coverage that can include prescreened medical services in each country visited.  Some policies also include repatriation coverage that helps transport the employee back to the United States if there is a problem in the foreign country.

Finally, all companies should consider kidnap and ransom coverage.  Although some countries are more hazardous than others, threats to employees or kidnappings can happen anywhere in the world.  Kidnap and ransom coverage provides the funds to pay for the ransom, but more importantly provides the investigators, security, translators, and negotiators that are needed when a kidnap event occurs.  Networks of these resources have been established by insurance carriers in most countries and can be activated with a simple phone call.  This saves precious time and money, and increases the chance of a positive outcome from the event.

Companies should review their international employee travel and make sure appropriate provisions are in force. Insurance may be an important part of that program.  Western Growers Insurance Services is a complete insurance brokerage and can provide you with any international insurance needs you might have.  If interested in finding out more, please contact Greg Nelson, director of commercial lines, at (949) 885-2287.

WG Staff Contact

Greg Nelson
Vice President, WGIS Sales
949-885-2287

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