From the rapid advancement of AI to ever-evolving legislation, private companies are facing a new set of challenges that demand immediate attention. Here are five ways to minimize emerging risks that could negatively impact your company’s financial stability and reputation.
1. Thoroughly understand AI technology before deploying it.
AI technology presents opportunities and challenges for private companies. When integrating third-party AI into your operations, your company may find itself liable for errors, omissions, data leaks and other risks. Mitigate exposures by making sure you fully understand the AI you use – both its development and its specific language model. By doing so, you can identify potential pitfalls in the AI system and protect your company from liability.
2. Avoid bankruptcy concerns by monitoring and diversifying your finances.
As the market softens and financial institutions experience instability, equity funds are less willing to fully support the portfolios of private businesses, leading to an increase in bankruptcy cases. This shift poses a significant threat to insurance coverage, which you can mitigate by diversifying your financial strategies, exploring alternative funding sources and proactively monitoring your financial health.
3. Re-examine your layoff procedures to avoid employment-related claims.
Given recent inflation and a looming recession, more and more employers are considering layoffs, increasing the risk of employment-related claims. Minimize your risks by ensuring you have fair severance packages and proper layoff procedures in place. Spend time reviewing how you communicate layoffs and how you decide which employees to let go.
4. Adjust employee drug policies to reflect your state’s marijuana legislation.
In states where medical and recreational marijuana use is legal, employers may face restrictions on drug testing and may be unable to penalize employees for off-duty marijuana use. This can have a big impact on industries that need a drug-free workplace, such as transportation and healthcare. Stay informed about state-specific marijuana laws and adjust your policies accordingly.
5. Establish a careful workers’ compensation process to avoid legal risks.
Failing to properly handle the placement and reemployment of injured workers can result in costly lawsuits, depending on the state in which your company operates. Carefully manage the entire workers’ compensation process, ensuring proper placement and reintegration for injured employees.
Stay ahead of trends by working with a knowledgeable partner.
Argo Pro’s Private Company Management Liability team is always up to date with the latest trends, providing the knowledge you need to avoid costly claims. With Private Company PROtectSM, we offer a comprehensive management liability package, providing private companies a range of coverage options.
Find out how Argo can be your reliable business partner.