There is no doubt business is going global. With more workers traveling abroad and spending extended times in foreign locations the risks for both traveler and company increase. In addition, travel abroad exposes staff to potentially serious financial risk from personal illness (i.e. sickness not related to a WC injury) and, in certain countries, kidnap and ransom, terrorism and war risks. Many of these exposures are not adequately covered under your standard Worker’s Compensation (WC) and Benefit policies. Prudence dictates the time to address these issues is before the traveler has left on their trip and not when the phone rings at 3:00 in the morning.
Traditional employment arrangements are a thing of the past; often bespoke staffing solutions include use of consultants, subcontractors, leased workers and, outside the US, categories can include local and third country nationals. Understanding what responsibilities the company has for both staff injuries and compliance related fines and penalties is an important part of doing business abroad.
Often there is little thought given to what the risks are for the human capital losses relating to business activities abroad. Our Human Capital Practice works with clients to identify a broad range of risks that could impact staff and resources. Our Human Capital Risk Map is a tool we use to begin identifying risks and traditional [insurance] mitigation techniques.
Worker's Compensation, while compulsory in the USA, is not required by state law for foreign risks. Foreign Voluntary Compensation Insurance should be included for any US employer with workers who are visiting non US locations. Coverage can be extended through an endorsement on a company’s traditional WC policy or purchased separately on a stand alone policy. This coverage is often included in an International Package policy as well. Risk management and human capital planning are a critical part of doing business abroad and a thoughtful Risk Review should be incorporated into any company’s overseas initiative.
If you are engaged in any type of operations outside the USA it would be prudent to have a Risk Review done across all areas, not just human capital, to identify material risks and how they may impact your company’s Total Cost of Risk (TCoR). Please do not hesitate to contact any of our Senior Advisors to help work through these issues. Their contact information can be found below.
Albert Sica, Managing Principal - email@example.com or 732.395.4251