Business travel and insuring the businesses that arrange business travel post-pandemic will be far from ‘business as usual’. There are a number of changes that businesses need to be aware of. This article focusses on the new International Standard and Business Interruption Insurance, although the consequences of the pandemic reach far wider.
We would all like to see a return to travelling as normal in a post-pandemic world, but the very clear message from scientists and governments is that we are going to need to learn to live with COVID-19 for some time to come.
Experts at the International Organisation for Standardization (ISO) have been working in conjunction with the British Standards Institute (BSI) and other national standards bodies to look at the management of risk to business and business travellers. Based on the principles, framework and process of ISO 3100, ISO 31030 was published at the end of September 2021.
First, it should be noted that this is guidance. There is no obligation to comply with it to the letter. The guidance is designed to help organisations manage risks, prepare their risk assessments and deal with the consequences of an incident if it occurs.
Inevitably, a lot of employees will feel more vulnerable when travelling as the world opens up again. The guidance is explicit in stating that it is designed to help organisations demonstrate that ‘their decisions related to risk are based on solid and reliable information.’
Kevin Myers, convener of the group of experts that developed the standard, has said:
Travel risks vary and change enormously based on destinations, political or health situations, amongst other things, and there is no one set of rules that works for every destination or traveller profile. ISO 31030 is a key tool to help any kind of organisation put a realistic and comprehensive plan in place to cover all bases and keep their workers safe when on the move.
The risks and strategy should be clearly communicated with the employee, who should agree with the assessment and approach. The employee should feel safe when travelling.
The standard is substantial but easy to digest and work through, running to about 50 pages. It is a helpful start for any size of organisation in preparing a risk assessment. There is a small section available for free online and it is well worth anyone managing their firm’s travel risk or strategy to have access to the balance of the document.
Whilst it is ‘guidance’, it will inevitably be referred to by lawyers should something go wrong during travel or where an employee has a relevant claim in a tribunal. Even though there is no legal requirement to implement the standard, not having a risk assessment prepared or otherwise following the framework could be fatal to the defence of a claim; it will be much easier to defend an employer who has implemented and followed the standard. Every employer owes a duty of care to their employees and adherence to the guidance would be helpful evidence of compliance with that duty.
Post Brexit, courts in England will not necessarily be bound by the decisions of other jurisdictions’ interpretation of the standard, but those decisions could be persuasive to an English court. This standard is implemented as guidance throughout the EU and in the UK. Jurisdictions further afield often adopt or refer to ISO standards.
Regular travel and health insurance policies now have COVID-19 exclusions that can make it difficult to recover costs where a trip has been cancelled or medical or quarantine costs are COVID-19 related. However, there are specialist insurers out there keen to take on the risk of travelling employees, and experts available to help organisations understand the risk of business travel. Pre-pandemic risks are still there, for example, car accidents, terrorist attack, or falling ill abroad. Inevitably, business insurers will expect to see the implementation of a comprehensive risk assessment and strategy.
Business Interruption (BI) Insurance
In May 2020, the Financial Conduct Authority (FCA) announced its intention to bring a test case to the High Court, seeking clarity on BI insurance policy wording in light of COVID-19. The FCA was looking for a “timely, transparent and authoritative judgment”. The test case, and the various appeals, culminated in early 2021. Financial Conduct Authority (FCA) v Arch Insurance (UK) Ltd and others  UKSC 1 aimed to resolve contractual uncertainty around the validity of many BI insurance policies, and ensure policyholders are treated fairly by insurers and insurance intermediaries. Whilst the decision was made in the early stages of the pandemic, the consequences are further reaching. Of significant importance is the FCA’s expectations of those dealing with BI insurance claims and complaints. That guidance was first published in May 2020 and was last updated on 26 July 2021.
The FCA continues to work closely with the Financial Ombudsman Service to monitor trends and (broadly summarised) expects:
- Insurers to be aware of their customers’ needs and to showflexibility especially due to any vulnerability caused by COVID-19. It does not expect to see customers’ ability to claim impacted by circumstances over which they have little control.
- Policy terms, exclusions, and the insurer’s approach and any decision to be clear and sympathetic, timely and accurate. Insurers have an essential role to play in supporting their policyholders.
- Insurers to assess and settle claims quickly and fairly. The financial pressures of the pandemic should not be exacerbated by the insurer’s conduct.
- Interim or partial payments to be made where there are reasonable grounds to do so. Many insurers had already been adopting this approach.
- Insurers to consider other ways to help their customers, such as signposting other sources of support.
Policyholders can find the guidance on the FCA website.
The pandemic has clearly caused challenges for business travel far beyond those addressed by the ISO and FCA, but the guidance offered by both organisations is essential as we try to mitigate the risks of travelling with the ever-present threat of COVID-19, and a return to business ‘as close to normal’ as it can be.
This article was first published in the ABTA’s Travel Law Today – Autumn 2021, which can be read in full here.
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