Directors & Officers: Navigating the landscape

My hot take: Company Director = Circus Performer.

Not seriously of course, but it does involve a juggling act with various roles and responsibilities serving as flaming pins. There is a tightrope to walk.

Fortunately, insurance can provide some measure of comfort and protection to anyone occupying this role, and indeed, I write on the presumption that you already have this, or at least have a basic understanding of it. However, for the uninitiated: Directors and Officers Liability Insurance, commonly referred to as D&O, is designed to protect Directors and senior decision makers of a business against claims of wrongful conduct.

Broadly speaking, it will pay for the costs associated with defending or settling HSE investigations, employment disputes and claims arising from, but not restricted to: breach of duty/trust, negligence, defamation and pollution – this could mean almost anything! It should also be remembered that the limited liability status of a company will not necessarily act as a barrier should a claim arise.

D&O isn’t by any means a ‘silver bullet’ that allows you to act with impunity but the scope of cover it affords should make it a no-brainer for any business especially as the legal landscape is constantly changing and we are starting to see a rise in the number claims particularly in the following areas:

  • Broadening of corporate criminal liability

UK Investigations are beginning to reflect the trend towards culpability of the individual; highlighted through the Serious Fraud Office (SFO) increasing use of deferred prosecution agreements.


  • Tougher Stance on Insolvency

In years following recession and uncertainty more businesses have fallen victim to insolvency, with legislation since 2015 having enabled liquidators to sell claims arising from fraudulent trading to third parties, thus providing further incentive to litigate.


  • Robust Regulation

Lessons learnt in the collapse of high-profile companies, like BHS, have toughened the stance of The Pension Regulator in cases of insolvency. Directors are expected to be held to account, with greater scrutiny being placed on their activities leading to liquidation to avoid short falls in pension schemes.


  • Emerging Risks

The world of tomorrow today! We live in a globalised society, one that’s increasingly connected and has encouraged discourse and allowed certain issues (technology, environmentalist, gender) to permeate the public consciousness. Please stop and consider if your responsibilities as a Director are against this backdrop. D&O claims for environmental exposure, sexual harassment and cyber breach are becoming increasingly prominent.

Of course this is a small sample of possible claims and any of the highlighted issues can spell protracted litigation and costs.

Should you have any questions and queries over the value or scope of D&O cover please don’t hesitate to contact ProAktive.

By Simon Wright Dip CIIAccount Executive

Property Rebuild Costs

A common property owners myth:  there is a direct relationship between the rebuild cost and the market value of a property. Unfortunately this rarely works out and leaves property owners at risk of under-insurance in the event of a claim.

For example, a property in the centre of London could have a market value in the millions and a rebuild cost at a fraction of this amount.

So how much would it cost to rebuild your property?  This can also called the ‘reinstatement cost’ or ‘sum insured’ by insurers but in essence, this figure needs to be the total amount you would need to pay to rebuild your property from the ground in the event of a total loss.  This figure needs to include:

  • Building materials
  • Labour
  • VAT
  • Debris Removal costs
  • Professional Fees (surveyors/architects)

Pricing tables can be used to calculate rough rebuild costs of properties but your property might not be standard.  For example, older buildings may contain asbestos which greatly increases the debris removal costs and listed buildings often cost more to rebuild.

Insurers use the rebuild cost as the main rating factor in property owners insurance and this is the maximum amount they will pay in the event of a claim.  Most property insurances have an average condition which means that insurers will only pay a claim in proportion to the underinsurance.  For example, if you insure a property for a rebuild cost of £250,000 and it costs £500,000 to rebuild, an insurer will only pay 50% of any building claim.

To talk to us about your business insurance requirements in more detail, please contact us on 01302 341 344.

By Kate Bacon ACIICommercial Account Handler


HMRC are taking a tough stance on minimum wage breaches

HM Revenue and Customs are currently very active in investigating businesses who they feel are breaching the national minimum wage and national living wage legislation. The number of HMRC investigations opened up into Employers, over potential breaches, increased by 43% from 2775 in 2016/17 to 3975 in 2017/18 and this is set to continue.

The increase in these rates is a worrying trend and so it is important that Employers review their systems to ensure they are not underpaying their Employees. In addition to enforcing back payments to affected Employees, HMRC also have the ability to impose substantial fines (double the amount of any underpayment) where breaches are discovered and more importantly, they name and shame offending businesses.

There are some instances where Employers can be caught out and be found to be eroding minimum wage; for example, making deductions which are not either statutory or contractual may be unlawful. Travel between assignments during the working day counts as working time and should therefore be paid.

Iceland Foods have recently fallen foul of the regulations as a result of a voluntary Christmas Saving Scheme which was deemed to be a violation – even though savings set aside were kept in a ring-fenced account and could be withdrawn by the Employee at any time. Branded as ‘just madness’ by Iceland’s Chief Exec!

Also, enforcing ‘uniform’ stipulations, even where not branded, has seen companies like Wagamama rethink and pay staff a ‘supplement’ to cover black jeans.

If you are unsure about this please feel free to contact our HR Consultancy Team on 01302 341 344.

By Angela Stancer ACIIHR Manager

How do you protect your drivers?

The road to crime is increasing with cargo thefts almost doubling last year. 2017 saw cargo thefts of 1,500, which increased to over 2,700 in 2018 (reported by The National Vehicle Crime Intelligence Service – NAVCIS).

With an increase of cargo theft, there is concern over the welfare of our drivers and the risk of assault against them.

How do you protect your drivers?

Here are some tips on safeguarding your people:

  • Plan your route – specialists advise that by changing your route as much as possible you may be able to avoid recognisable patterns that can be monitored by thieves
  • Remove Keys – sounds a bit obvious but you would be surprised how many people leave their keys in their trucks when fuelling up or popping to a café in a layby
  • Lock cab doors while drivingthieves may try to gain access to the cab when you stop for traffic lights or at junctions
  • Drivers matewhere you may be delivering expensive items, opportunists are less likely to attempt a theft when drivers come in pairs
  • Approved overnight parkingavoid isolated and unlit parking bays. Where possible look to park in an approved HGC parking facility
  • Camera systems – can help to deter thieves and it allows the drivers to keep an eye on what is going on outside the cab
  • Avoid regular stops – drivers that regularly stop at local shops for newspapers and snacks are more likely to be targeted by opportunists. If you need to stop, try to do so at service stations and when returning to your cab, check for signs of tampering – doors, seals, straps and curtains
  • Stay Safe – in the unfortunate event that you are subject to a theft or criminal activity, remain in your cab with doors locked until help arrives. Switch on the headlights and sound your horn repeatedly – thieves don’t want the attention so this may be enough to scare them away

Fact – Every HGV driver spends around 32 hours a year stuck in traffic – lock your cab doors!

For a health and safety review of your current driver safety precautions, please get in touch.

Please keep a look out for your invitation to our HR for Hauliers workshop (free event) on 3rd July.

A ProAktive Helping Hand for Hauliers





Holiday Entitlement: Use it or lose it

In the UK, there is no automatic right to carry over holiday leave from one year to another and often UK employment contracts state that annual leave that is not taken will be lost.

However, in a recent European ruling, a German employee has won a claim for unpaid holiday pay arising from holiday he failed to take some 6 years ago.

In this case the European CJEU court ruled that the employee was entitled to compensation for his lost holiday because the employer did not take adequate steps to ensure that the employee was aware that he would lose his holiday if he did not request it.

With European legal decisions continuing to apply to the UK until Brexit and during any transition period, this case carries significance for UK employers.  Whilst companies can continue to adopt the ‘use it or lose it’ approach, they may have to consider how they implement this.

Whilst there is no definition of what would be considered as adequate notice, it is good practice for employers to provide employees with plenty of notice that they have unused holiday entitlement which they will lose should they not request it.  Providing this information in writing and keeping a record of this can also help to stop any later dispute that the employee was not aware of the consequences of not using their annual holiday entitlement.

It is important for employers to remember that the ‘use it or lose’ it approach does not apply to maternity leave (during which holiday continues to accrue) or for employees on long terms sick (where additional time should be allowed for them to take the annual leave).

If you would like futher advice relating to holiday entitlement or any other area of HR management, please contact us on 01302 341 344.

By Louise Turner – Dip Mgmt (Open) Assoc CIPDHR Business Partner








Workplace Transport

Fork lift trucks are a popular commodity for a lot of businesses, and it is often the case that they are driven in areas where people are working. In recent months we have seen several prosecutions relating to workplace transport and this simply reiterates the importance of ensuring you manage the workplace transport on your site.

  • A poultry producer has been fined £866,650 after a forklift truck driver reversed into a yardman. The yardman sustained serious injuries and his left leg had to be amputated above the knee.
  • A company was fined £150,000 after a delivery driver was hit by a reversing vehicle as he carried out a pre-use check on his lorry.
  • A courier company was fined £120,000 after an agency worker was hit and run over by a forklift truck. The worker sustained injuries to both legs.
  • A cast iron bar manufacturer was fined £100,000 after an employee was struck by a forklift truck and sustained a fractured leg.

In all these cases the court has commented on the inadequacy of the risk assessments and safe systems of work in place relating to workplace transport. They could all have been avoided if basic precautions had been put in place.

There are three key areas to consider when assessing the risk on your site:

  • safe site (design and activity)
  • safe vehicle
  • safe driver

Safe site

The best way to keep people safe is to segregate vehicles and pedestrians. The most effective way to do this is to provide separate pedestrian and vehicle traffic routes. It might be that complete segregation is not possible, so clearly marked pedestrian and vehicle traffic routes using measures such as barriers and signs, would be a suitable alternative.

Reducing vehicle speed is an important part of workplace transport safety. Fixed traffic control measures can reduce vehicle speed and speed limits can also be used, but they need to be appropriate and properly enforced.

Every workplace should have suitable and sufficient lighting.

Around a quarter of all deaths involving vehicles at work occur as a result of reversing so reducing the need for reversing on site is important. Where it is necessary, trained banksmen should be used.

To minimise the risks to those involved in loading and unloading, the loading area should be clear of traffic and people not involved in the activity and segregated from other work areas.

Safe vehicle

Vehicles used in the workplace should be suitable for the purpose for which they are used. Warning devices should be fitted, so they stand out to pedestrians.

Vehicles should be maintained in good working order, so they remain mechanically sound. Regular inspections play a vital role in this. Drivers should carry out daily checks.

Safe driver

Drivers should be trained, competent and fit to operate a vehicle safely and receive appropriate information, instruction and training for the vehicle they use. Drivers must use all safety features, in particularly seat belts, at all times regardless of the duration of the task. We have seen a number of fatalities involving fork lift trucks due to the driver not wearing a seat belt. If a belt is fitted and not worn the HSE will prosecute on the basis of a failure to manage your employees.

If you would like any further information or advice, please give me a call on 01302 341 344.

By Rachel Cuff CMIOSHRisk Consultant

Certainty in an uncertain world

So here we are; Spring 2019 and it seems that the only thing that is certain is uncertainty. The world feels unstable, although in truth it’s probably no more unstable than it has ever been, yet through the prisms of social media, 24 hour news and the never ending background noise that accompanies modern life, it can often feel that the end is nigh! I don’t think it is.

What is certain is that to be successful, a business needs to understand and manage its risks. Insurance is a great ‘enabler’ as it gives business the confidence to make decisions with an element of certainty. Typically, business risks have revolved around supply chains, customer credit, capital investment and the delivery of specialist services amongst other things, however, business risk is changing.

The internet of things (IOT), artificial intelligence, digitalisation, including digital manufacturing, and our increasing reliance on digital transactions, robotics, autonomous vehicles and the changing demands of our people and culture means that our insurance and risk management programmes must reflect our present and also be able to cope with our imminent future.

A further development in this area will be the way in which insurance is arranged. The role of the Insurance Broker is changing from a transaction based service to a business consultancy. At ProAktive we have already embarked on this journey and we are seeking to help identify the new risks and provide innovative solutions whilst minimising cost. Hopefully, we can help provide some certainty and stability in our uncertain world.

By Andy Morley – Group Managing Director

How do you manage your fleet?

Whether your company has two vans or 100 HGV’s, the way you manage your fleet can and will have a massive impact on the cost of your insurance. Fleet insurance costs can be detrimental to a business and with costs slowly increasing, are you thinking about ways to improve?

Over the last few years there have been a number of tools becoming popular for fleet users.

Dash cameras have become increasingly popular over the last 10 years, but are they really beneficial to you?

Before you go out and purchase a hundred cameras, the key is actually looking at your current claims record and marrying that up with the type of locations, times and frequency of where your vehicles are heading.

It is important that if you are choosing to invest financially in a product to reduce claims that you choose a tool that will be most beneficial to you. Cameras can be extremely helpful when it comes to defending a claim in court but is it relevant to your business? If your vehicles are regularly driving along motorways and in and out of cities and towns, cameras may be a great option. However, if you are a haulier or courier that is making quick, short trips in and out of public car parks, your claims experience may show that the majority of claims are clipping and scraping unattended parked vehicles. In this case, it is unlikely that a dash cam could help with this. What you should be thinking about are parking sensors.

As your business advisers and specialists in the motor industry, it is crucial that we work with our clients to analyse your claims to establish a positive way to move forward. Whether that be dash cameras or parking sensors or even additional driver training.

We regularly work with our clients to put together a tailored risk management plan to move forward in a positive way.

  • How often do you shadow your drivers?
  • When did your drivers last do an online driving assessment?
  • How do you keep up to date with checking driving licences?
  • Do you run a driver performance scheme?
  • Do your drivers understand the importance of how claims can affect your business?
  • How do you report claims?
  • Are drivers aware of the information that they need to collect following a claim?

To review your current procedures and for a full claims analysis please get in touch to discuss where we can add value. We are here to act as your business advisers, not just for insurance but risk management, health and safety and HR with the ultimate aim of reducing your insurance costs and improving performance.

If you claim less, you pay less.

By Leah KendallAccount Executive 


Bridging the Gap

What is GAP insurance?

Guaranteed Asset Protection is designed to protect you when you buy a new car to cover the difference between the amount your car insurer would pay out if your car was stolen, or written off, and the price you paid for your vehicle.

In the event of damage to, or total loss of your vehicle, your car insurer will pay to put you back in the same position as you were at the time of the loss or damage, and will typically pay market value of the vehicle on the date of the loss. This can leave a financial shortfall if you have outstanding finance for the vehicle or if you are looking to replace your vehicle with a new one of the same specification.

Do I need this cover?

If you either used a large loan to buy your vehicle, or your car is on a long term lease, or you are worried about the depreciation of your vehicle, then you may want to consider a GAP cover.

There are several types of cover available to meet your specific needs;

  • Vehicle replacement gap insurance: This covers the difference between the lump sum you get from your car insurer, and the amount your car would cost to buy new. This means you may get more than you paid to allow for the rising cost of cars.
  • Return to invoice gap insurance: This covers the shortfall between what your car insurance policy pays out, and the exact amount you paid for your car, and can be used for both new and second hand vehicles.
  • Return to value: This covers the difference between the insurance pay out and the market value of your car when you bought it. This could pay out more than return to invoice cover if you got a discount when you bought your car.
  • Finance gap insurance: This covers any money you owe a finance company if the insurance pay out does not repay your debt. This means you will have no car or cash after you claim, but what you owe will be paid off.

Where can I buy GAP cover?

Most car dealerships will offer the cover, however it is worth shopping around as policies can be bought at competitive prices with other providers.

ProAktive are able to offer a competitively priced ‘Return to Invoice’ policy to fill the gap between the claim payment and the exact price paid for the vehicle. To speak to us about this please call us on either 01302 341 344 or 0114 243 9914.

By Sandy Lockwood Cert CII Commercial Account Handler

Respiratory Protective Equipment and Facial Hair

With the recent news that welding fume has been classified as carcinogenic to humans by the International Agency for Research on Cancer (IARC) there has been much talk in the workplace about respiratory protective equipment (RPE) and facial hair.

Before we discuss respiratory protection it’s important to remember that any form of personal protective equipment, including RPE, should be a last resort and controls that work collectively should be preferred. For instance, efficient extraction at source will protect all personnel in the workplace while RPE only protects the individual. Assuming adequate control can be achieved with extraction we do not need to provide RPE.

There are various types of RPE but one of the most common types are filtered face masks. These can be reusable or disposable and are relatively inexpensive. Filtered face masks are perfectly adequate for protecting employees from harm due to the inhalation of airborne contaminates, however they rely on forming a good seal between the mask and the users face.

Face fit testing can be carried out to confirm that the RPE is effective in protecting the user.  Unfortunately, employees with facial hair growth may find that it is impossible to form a seal between their face and the face mask. In these cases, the RPE will not protect the individual from exposure to the harmful substance as intended.

What are the options if an employee has a beard but also needs to wear RPE to protect their health?

  1. Explain the issue and ask the employee to attend work clean-shaven. This may be emotive, and employees may refuse. As an employer you have no option other than to protect your employees from harm so you may have to insist that they shave or make alternative arrangements.

Enforcing employees to shave using your company disciplinary procedure may be possible but you should consult your human resources adviser to ensure that you follow the correct procedures.

Be aware that “religion or belief” is one of nine protected characteristics under the Equality Act 2010 and that employees who have facial hair due to religious reasons may be able to claim that they were discriminated against!

Also consider employees who may have medical reasons why they should not shave. They should be able to provide medical evidence to back this up.

  1. Another option is to remove the employee from exposure by making reasonable adjustments to their work or providing alternative work. This option may not be possible and needs careful consideration. Again, you may need to consult your human resources advisor for guidance on the correct procedures.
  2. Provide air-fed respiratory protection. Air-fed RPE does not rely on a seal between the face and mask and will protect employees with beards from exposure to hazardous substances. This may be an ideal solution, but the main disadvantage is that it can be expensive.

This may be a difficult situation, but it is important to protect your employees. There may be other options open to you. If you need any advice, please contact us and we can discuss in more detail.

By Ainslie Johnson GradIOSHRisk Consultant