expert series feb. 2012: globalex insurance considerations for startups

Insurance Considerations

for Startups

Presented by

February 29, 2012

• Property • Commercial General Liability • Product Liability• Errors & Omissions Liability• Intellectual Property Liability• Directors & Officers Liability• Workers Compensation• Partnership - Life• Key Man Insurance• Group Benefits• And more...

Insurance available to Startups

R&D

Office LeaseTradeshows

Hiring Employees

Commercialization

Outside Investors

Inventory

Company Valuation

Outsourcing

Startups need insurance

Why and When?

Exposure• Limited exposures• Prototypes

Insurance• Often no insurance in place• If working from home, homeowner insurer

might require Commercial General Liability

Research & Development

Exposure • Contractual lease requirements

Insurance• Commercial General Liability Insurance• Property Insurance

Office Lease and Tradeshows

Exposure• Attracting and retaining personnel• Loss of key personel

Insurance• Group benefits• Workers Compensation insurance• Keyman insurance

Hiring Employees

Exposure• Product and/or services exposure• Meeting contractual requirements• Increase client confidence

Insurance• Product Liability• Errors & Omissions/Professional Liability

Commercialization

Exposure • Higher property values• Property at third party locations

Insurance• Business interruption• Increased property values• Property in transit

Inventory

Exposure• Negligence or error by subcontractors• Loss at sucontractor location

Insurance• Verifying insurance carried by subcontractors• Being added as Additional Insured• Property in transit• Business interruption from loss at

subcontractor

Outsourcing

Exposure• Protect their investment• Financial impairment• Mismanagement• Employment practices

Insurance• Directors & Officers Liability Insurance• Review of insurance program

Outside Investors

Exposure• Death or disability of a shareholder• Third party suit

Insurance• Partnership insurance (life insurance)• Review of coverage and levels of insurance• Intellectual Property insurance

Increase of Company Valuation

Contracts

Non-Insurance Considerations

Recommended Language– Limitation of liabilities– Indemnification Agreement / Hold Harmless– Arbitration Clause – Disclaimer of Warranties – Force Majeure – Performance and Scope – Term and Termination – Governing Law

Your first line of defence before insurance responds

Neil Moloney, Partner613-226-8185 x.252

nmoloney@globalex.com

Serge Paquette, BCom613-226-8185 x.244

spaquette@globalex.com

www.globalex.com

Thank You