A well-crafted business insurance policy takes the client’s industry risks, along with internal and external risk factors, into account. Through a consultative approach, a knowledgeable insurance agent identifies specific factors that may cause other exposures. The experts at Hauser Insurance Group employ these tactics to maximize client results and look to proactive risk management to ensure overarching success.
If a business insurance agency services private equity firms, the risk exposure issue becomes more complex. To illustrate, a firm involved in a merger or acquisition will require coverage for its own risks. Coverage may also be provided for the company’s portfolio businesses along with the acquisition target.
Hauser Insurance Group brings its proven risk management expertise to every exposure scenario. Founder-led companies, multinational corporations, and private equity firms alike will benefit from Hauser’s extensive due diligence and carefully crafted insurance solutions.
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Three Common Business Risks
Companies of varied types and sizes face potentially damaging business risks every day. Although some risks pertain to specific industries and work settings, three types of risk exposures are common to all businesses. Companies often face multiple business risks at the same time.
Operational Risks
An internal or external operational risk can result in the business’ inability to function normally. External operational risks include natural disasters such as devastating hurricanes or fires. A massive power outage can also impact the company’s operational status.
Internal operational risk factors include a company-wide server outage or employee errors that lead to negative financial impacts. In addition, some operational risk factors can damage the business’ carefully cultivated reputation.
Addressing operational risks involves careful risk assessment followed by targeted insurance solutions. In addition, a proactive business continuity plan provides the company with a clear path forward should an operational disruption occur.
Compliance Risks
In the 21st century, operating a business involves compliance with countless federal, state, and local laws and regulations. On the larger scale, applicable federal laws include those from the Environmental Protection Agency (or EPA) or the Occupational Safety and Health Administration (or OSHA).
Other laws and regulations pertain to specific types of businesses. To illustrate, retailers must comply with strict payment processing and customer data security requirements. The Payment Card Industry Data Security Standards (or PCI DSS) outline specific data protection protocols that all retailers must follow. Lack of compliance can result in substantial penalties and fines.
To further complicate the issue, business owners may not be aware of specific laws and regulations that apply to their industry. Despite this fact, each company is still expected to comply with the applicable laws and regulations.
Monitoring relevant government publications, and becoming active in industry organizations, are good ways to keep abreast of industry compliance criteria. Working with a compliance specialist, such as Hauser Insurance Group, enables identification of applicable standards. This specialized insurance professional can also design an insurance solution that offers protection where necessary.
Cybersecurity Risks
Although cybercrime has been on the increase for years, the 2020 COVID-19 pandemic provided optimum conditions for cybercriminals to wreak havoc on computer networks. As government lockdowns forced many businesses to close their physical offices, they shifted to remote operations out of necessity.
As a result, remote workers’ reliance on less-secure residential networks and personal electronic devices increased the number of potential data extraction points. In addition, pandemic-era operations revealed many companies’ inadequate information technology networks and substandard security controls.
Ransomware Attacks On The Rise
Not surprisingly, cybercriminals drastically ramped up their ransomware attacks during 2020. For perspective, global ransomware assaults skyrocketed by 40 percent during 2020’s first three quarters compared to the same period in 2019. As the insurance experts at Hauser Insurance Group note, United States-based businesses are most often targeted by ransomware schemes.
More than 60 percent of ransomware attacks impact small- or medium-sized businesses. Because of budget constraints, and disbelief that the company is a cyberattack target, many smaller businesses do not have any protections in place.
However, larger companies are also at increased risk. Many cybercriminals now utilize AI-enabled attack software, making larger firms equally vulnerable to core and backup system infiltration. The proliferation of hacked-data extortion schemes further compounds the problem.
Finally, the increasing availability of “ransomware as a service” offerings is another troublesome development. In effect, there now exists a thriving underground market that caters to opportunistic cybercriminals who want to bypass the actual hacking work while still reaping its potential rewards.
Private Equity Firms’ Increased Risk Exposures
Successful private equity firms face many of the same business risks as other companies. However, the equity firms’ operational infrastructure introduces additional risks that should be addressed. Hauser also analyzes the risks of each firm’s portfolio businesses and acquisition targets.
The Hauser Insurance Group Transaction Services Team specializes in corporate risk due diligence and related insurance services. Specifically, Hauser discovers potential coverage gaps and compliance problems. Based on the findings, the team delivers targeted solutions that include cost-saving strategies.
Hauser Insurance Offers Three Key Types Of Due Diligence
The Hauser Insurance Group risk management due diligence program includes three distinct areas of focus. Each client’s risk exposures are different, and a thorough analysis enables the design of a targeted insurance solution.
Insurance Assessment
During an insurance assessment, a Hauser team member will evaluate the client’s current insurance coverage. In addition to reviewing contract provisions, they will identify coverage gaps and gauge the adequacy of internal company programs. Finally, Hauser will recommend new or revised Management Liability and Property and Casualty Programs to be activated at closing.
Transactional Assessment
A thorough transactional assessment includes a detailed examination of joint venture agreements relative to transactional and insurance obligations. Hauser will also evaluate current and past purchase agreements to identify assumption of liabilities issues. Finally, Hauser will ensure that the client complies with applicable lender insurance criteria.
Financial Assessment
Hauser will conduct a financial assessment that includes claim reserve and self-insured retentions analyses. In addition, a team member will evaluate escrow deposits and outstanding letters of credit for post-close resolution. Finally, Hauser will propose transactional insurance solutions after verifying insurance carriers’ solvency and financial ratings.
Benefits Of Hauser Insurance Group’s Risk Management Strategy
A well-regarded business insurance agency incorporates risk management into its targeted insurance solutions. Hauser Insurance Group begins with risk management due diligence when designing insurance coverage for clients in diverse industries.
This laser focus on each client’s risk exposures enables Hauser to better tailor its products to the client’s needs. The enhanced insurance analysis also encourages the development of more comprehensive offerings. This innovative approach positions Hauser Insurance Group as a leader in the business and commercial insurance industry.
Team Members’ Proven Expertise
Hauser’s skilled team members successfully execute high-level insurance and transactional due diligence. These risk advisors possess demonstrated subject matter expertise, and they have earned national recognition for the quality of their work.
Specifically, Hauser’s risk advisors are keenly familiar with general business and commercial risk exposures. In addition, these tenured professionals comprehend the nuances and complexities that often characterize a merger or acquisition transaction.
About Hauser Insurance Group
Hauser Insurance Group is a nationally recognized insurance agency headquartered in Cincinnati, Ohio. Serving clients since 1971, this privately held company offers proven risk management expertise and targeted insurance solutions to businesses in varied industries. The Company is also a well-regarded provider of employee benefits services.
Multispecialty Team With Proven Expertise
Hauser’s nationally acclaimed advisory team includes risk advisors along with skilled merger and acquisition consultants. The team also contains brokerage professionals experienced in private equity transactional work.
The Company executes exhaustive due diligence related to risk management and targeted insurance solutions. Other due diligence capabilities pertain to transactional support, insurance brokerage, and employee benefits services.
With regional offices across the United States, Hauser Insurance Group is well positioned to serve clients in many geographic locations. The Company maintains full-service offices in Atlanta, New York City, and Chicago. Additional service centers in St. Louis, Kansas City, and Los Angeles complete the roster of Hauser facilities.
Serving A Multinational Client Base
Hauser Insurance Group’s client roster includes public companies along with publicly traded retail businesses. Family-based manufacturing firms are also on Hauser’s diversified client list. Finally, the Company serves special-purpose acquisition companies (or SPACs) and numerous multinational corporations.
Private Equity Firms And Related Entities
While Hauser continues to serve businesses in numerous industries, the Company maintains a strong focus on the private equity firm market. Where applicable, Hauser also provides risk management, due diligence, and insurance solutions services to the firms’ portfolio companies and acquisition targets.
In 2021, Hauser Insurance Group’s client base includes 70 private equity firms throughout 44 states. During 2020, the Company was instrumental in the completion of nearly 200 private equity transactions.
During its 40+ years in operation, Hauser Insurance Group’s many clients have benefited from the Company’s consultative approach. By learning about each business’ specialized risk exposures and coverage needs, Hauser can tailor its insurance solutions to meet those requirements.
Where mergers or acquisitions are involved, Hauser’s experienced risk advisors can address each firm’s individual challenges. By providing targeted coverage for the private equity firm, along with its portfolio businesses and acquisition targets, Hauser can help to set the stage for a successful transaction.
If you are interested in even more business-related articles and information from us here at Bit Rebels, then we have a lot to choose from.
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