Insurance is something we think about naturally for our homes, cars and even our lives. But should you be considering it on your project too?
Insurance is a risk response strategy to help you mitigate the impact of what might go wrong on your project. Typically, we do talk about positive and negative risk, and while I’m sure you could probably find a firm to insure you against positive risk, you are far more likely to consider insurance as a support strategy for negative risk.
What could you insure?
Through a broker, you can pretty much insure against anything. However, organising specialist, one-off insurance for a very specific, unique, circumstance is potentially a lot of work (and expense) so you would only want to do that if your project was large enough to support that effort.
However, you can more easily insure a range of other, more ‘regular’ things on your project. For example, event cancellation due to poor weather or low attendance rates. In this situation, you’d get a pay out from the insurance if you had to cancel the cycle race you’d organised (for example). This would help you offset the costs you had incurred organising the cycle race, like catering vans, first aid teams, water for the cyclists, security and so on – all costs you’d still have to pay because you’ve booked them and probably can’t cancel them with such short notice.
Another type of insurance to consider for your project team is travel insurance. If your team is travelling a lot for work, it would be worth checking that your company offers insurance for employees travelling for business.
This would cover them if they lost their laptop or other work items while away for business. It could also help cover the costs of travel arrangements if their flights were cancelled, or they were unable to travel.
Other insurance for staff
If you are a sole proprietor or a small business owner – and many project managers do work independently as contractors or in small consulting firms – then it’s also worth considering other types of insurance that cover you and your team as individuals.
For example, in the UK you can get director’s insurance, that covers the business in the case that the director is unable to carry out their duties, say, due to illness.
You can also organise health insurance for the team. Depending on where you are in the world, healthcare costs can be really expensive. Insurance will help offset those costs, and help an employee get back on their feet (and back to work) more quickly.
I should add that I am not a financial advisor, and the points above are given simply to give you ideas of how to consider the part insurance could play in your business and on your project. If you don’t have anything set up yet for your team, it’s worth asking the question of your Finance team or Director. Get some proper advice from a financial advisor.
Think about whether insurance is a viable option for your risk mitigation strategies and if so, you may be grateful one day for having it set up!
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