As more holiday shoppers head to their computers, brokers working with retail clients may want to reassess coverage options.
Canadian consumers have increased their online shopping patterns significantly this year, and plan to turn to the Internet in even greater numbers to do their holiday shopping next month.
According to a poll conducted by Solutions Research Group in August, two-thirds of Canadians said they had made an online purchase in the past month while 25 per cent said their holiday shopping would be a 50-50 split among online e-tailers and traditional storefronts. That’s up 10 per cent from the previous year, the group noted.
And while many survey respondents named major hubs like Amazon or Wal-Mart as their online shopping destinations, many more plan to pursue offerings from local retailers — particularly through new, mobile-enhanced technology.
For insurance brokers advising retail clients, the message is clear: revisit that client’s existing insurance portfolio and, if necessary, add to it.
Of course, convincing clients of the necessity of an additional cyber or privacy liability policy may be difficult, says David Derigiotis, head of the Professional Liability Center for Excellence for Burns & Wilcox. This is particularly true for small businesses that rely on mobile payment systems, though they stand the most to lose from a potential data breach.
“Small businesses do not think that they’re a target. They don’t think they’re on anybody’s radar, and that’s just not the case,” said Derigiotis, whose brokerage has worked with tech liability risks since the dot-com boom of the1990s. “They are vulnerable and they are a huge target because their operations are generally not sophisticated enough to properly safeguard the organization.”
Even when small merchants do recognize the risks attendant with mobile payment platforms, they are hesitant to incorporate insurance into their risk management strategy. Many fear adding to their already high insurance bill, Derigiotis noted. In truth, an annual cyber or privacy liability policy can be obtained for a small business for as little as $500 annually.
And, given the softening market's low prices, "there's no better time to buy than right now."
